KUCHING: Malaysia will maintain the price of RON95 petrol at RM1.99 despite rising global oil prices triggered by geopolitical tensions in the Middle East.
Prime Minister Datuk Seri Anwar Ibrahim said the government has decided to retain the subsidy to protect Malaysians from the impact of escalating fuel prices and the rising cost of living.
He noted that global crude oil prices have surged to more than USD100 per barrel following instability in the Gulf region, which has also disrupted shipping routes and energy supply chains.
“Oil prices have already surpassed USD100, and this will certainly affect our economy,” he said during a Ramadan event at Sukma Ria today.
According to Anwar, the situation has been worsened by disruptions in the Strait of Hormuz, a key global shipping route where hundreds of oil tankers and cargo vessels transporting energy and machinery have reportedly been delayed.
The Prime Minister said the global uncertainty requires Malaysia to take careful and strategic measures to safeguard its economy and protect the welfare of the people.
Despite the mounting pressure on government finances, he said the administration has decided to maintain the RON95 subsidy policy.
“Last year we reduced the price of RON95 to RM1.99, among the lowest in the world. We did this because we did not want ordinary Malaysians to be burdened by rising fuel prices, which directly affect transportation costs and the cost of living,” he said.
Anwar added that the subsidy policy had received full support from the Cabinet and has been implemented successfully.
However, he acknowledged that maintaining the subsidy comes at a significant cost to the government.
Anwar said the combined subsidies for petrol and diesel currently stand at about RM3.2 billion, with petrol subsidies alone at an estimated RM2 billion.
If current conditions continue until the end of the year, petrol subsidies alone could reach RM24 billion.
Nevertheless, Anwar stressed that the government would not rush into policy changes and would continue to prioritise the welfare of the people.
He also called for stronger “domestic resilience”, urging civil servants, businesses and workers across sectors to improve productivity and strengthen Malaysia’s economic capacity in facing global challenges.
