Indonesia Bets Big on Biodiesel to Limit Costs of Oil Imports

Workers load palm oil seeds into the back of a truck at a plantation area in Pelalawan, Riau province in Indonesia's Sumatra island on Sept. 16, 2015. Adek Berry /AFP/ file/Getty Images

JAKARTA—Indonesia plans to require all diesel fuel used in the country contain biodiesel starting next month to boost palm oil consumption, slash fuel imports, and narrow a yawning current account gap.

While the proposal has been welcomed by the palm oil industry and government, it has raised concerns among the automobile industry the fuel could impact engine performance.