The ministry of domestic trade and cost of living (KPDN) is in the final stages of discussions for the introduction of new regulations for the sale of unsubsidised fuel in border areas such as in the state of Perlis, according to Bernama.

An upcoming programme for the sale of RON 95 petrol and diesel fuels on a non-subsidised basis to foreign-registered vehicles will start on a pilot basis in Perlis as there are commercial petrol station operators who sell fuel without subsidy in Padang Besar and Wang Kelian, according to the report.

This pilot programme is expected to begin in January, and its impact study will be carried out within three months before a decision will be made on the programme’s rolling out in other border states in Malaysia, the report continued.

The programme, named “Border Economy – Supply of RON 95 petrol and diesel without subsidy” allowed for the purchase of unsubsidised fuel for foreign-registered vehicles in states bordering neighbouring countries, said KPDN secretary-general Datuk Azman Mohd Yusof.

“This step was taken to curb the issue (leakage) faced, and does not have a negative impact on foreign vehicles filling up with fuel. The price of [RON 95 petrol and diesel] fuel without the subsidy is still cheaper that that sold in neighbouring countries,” Azman said.

The move to introduce the regulations was to allow the purchase of fuels without subsidy was made as there have been cases of foreign-registered vehicles found to be filling up with subsidised diesel in limited quantities, but at several petrol stations, according to the report.

“The leakage of subsidised RON 95 petrol and diesel in the states near the border is taken seriously by the KPDN because the subsidies that should be enjoyed by the people of this country are also enjoyed by foreigners,” the KPDN secretary-general said.

The ban on purchasing RON 95 petrol for foreign-registered vehicles has been in place since August 1, 2010, though there are certain allowances where diesel is concerned. Singapore-registered vehicles are permitted the purchase of up to 20 litres of diesel per day at Malaysian petrol stations within 25 km of the Malaysia-Singapore border gate; this ruling came into effect on October 1, 2020.

At present, the price of RON 95 petrol is RM2.05 per litre, which is the ceiling price for the fuel as introduced by the Malaysian government in February 2021. A price cap also applies to diesel fuels in their Euro 5 B10 and B20 blends, priced at RM2.15 per litre, and Euro 5 B7 diesel, which is priced at RM2.35 per litre. The unsubsidised RON 97 petrol is priced at RM3.35 per litre as of December 22, 2022.