After defending the interests of oil exporting nations for five decades, OPEC has made a surprising choice with its newest member: a country that consumes about twice as much crude as it pumps.
Indonesia will rejoin the Organization of Petroleum Exporting Countries as its 13th nation next month, almost seven years after suspending its membership. The country says that as OPEC’s only Asian constituent it will provide a vital link to the region where demand is growing fastest.
Still, saddled with an oil import bill of about $13 billion last year, Indonesia makes an unlikely addition to the exporters club.
“If you’re accepting net oil importers into the organization, it speaks volumes about the marginalization of OPEC,” said Seth Kleinman, head of energy strategy at Citigroup. Indonesia is “never going to cut” supply, he said.