Streamlining Energy Supply Chains: The Impact of Targeted Fuel Subsidy Management on Industrial Logistics Cost Architectures
DOI:
https://doi.org/10.70076/simj.v3i3.210Keywords:
fuel subsidy, targeted subsidy management, energy supply chain, industrial logistics, logistics costs, fuel prices, supply chain efficiencyAbstract
Energy costs are a critical component of industrial logistics expenditures, as fuel prices directly affect transportation, distribution, and supply chain operations. In developing economies such as Indonesia, fuel subsidies have traditionally been implemented to maintain energy affordability and support economic stability. However, broad-based subsidy schemes may create market distortions, encourage inefficient energy consumption, and increase fiscal burdens. This study aims to analyze the impact of targeted fuel subsidy management on industrial logistics cost structures and supply chain efficiency. A qualitative Systematic Literature Review (SLR) was conducted by examining scientific literature on fuel subsidies, energy pricing, industrial fuel consumption, logistics costs, transportation costs, and energy supply chain management. The literature was selected based on thematic relevance, publication quality, and alignment with the research objectives. The findings indicate that fuel prices significantly influence industrial operating costs, particularly through transportation and distribution activities. Inefficient subsidy mechanisms may distort energy consumption patterns and reduce incentives for industrial firms to improve energy efficiency. Conversely, targeted fuel subsidy management has the potential to improve energy resource allocation, minimize cost distortions, and support more efficient supply chain operations. Its effectiveness, however, depends on accurate beneficiary identification, reliable distribution systems, effective monitoring, and policy coordination between the energy and logistics sectors. This study concludes that targeted fuel subsidy management can contribute to more efficient industrial logistics cost structures and improved supply chain performance when subsidy allocation is aligned with industrial needs, fuel consumption patterns, and broader energy efficiency objectives.
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