Sales of retail diesel in Malaysia sees 30% reduction after subsidy rationalisation: finance minister II

Sales of retail diesel in Malaysia sees 30% reduction after subsidy rationalisation: finance minister II

Retail sales of diesel at petrol station in Malaysia has seen a 30% decrease in the first week since the subsidy rationalisation took effect on June 10, reported New Straits Times.

This was equal to a reduction of eight million litres of diesel a day compared with the previous week, said finance minister II Datuk Seri Amir Hamzah Azizan during a ministerial explanatory session in the Dewan Rakyat. Meanwhile, commercial sales of diesel, or that purchased by companies at the unsubsidised market rate, increased by four million litres in the same period, he said.

This indicated that some companies which should have purchased diesel at market prices had previously bought diesel at the subsidised, retail rate, the minister said. “The upward trend in commercial diesel sales is also positive as it indicates a reduction in subsidised diesel leakages,” he added.

An oil company had informed the authorities that sales of diesel fuel at petrol stations near national borders have dropped by 40%, Amir Hamzah said. “This information was obtained from an oil company, which has provided additional evidence of diesel smuggling into neighbouring countries,” the minister added.

Sales of retail diesel in Malaysia sees 30% reduction after subsidy rationalisation: finance minister II

The minister also said that Malaysia’s diesel subsidy expenditure had increased ten-fold, from RM1.4 billion in 2019 to RM14.3 billion in 2023, stating that the increase in subsidy expenditure was not solely due to market price increases, but also due to the increased consumption of subsidised diesel.

“The amount of subsidised diesel used has surged by approximately 80 per cent, from 6.1 billion litres in 2019 to 10.8 billion litres in 2023, despite no significant increase in new diesel vehicles during the same period. During this period, the sales volume of unsubsidised commercial diesel had decreased by two billion litres,” the minister said.

Rationalisation of the diesel fuel subsidy which took place on June 10 saw the price of Euro 5 B10 and B20 diesel in Peninsular Malaysia increase by RM1.20, or 56% from its subsidised rate of RM2.15 per litre, to RM3.35 per litre, while the Euro 5 B7 grade of diesel held the same 20 sen price margin above the B10 and B20 grades, now priced at RM3.55 per litre.

Financial assistance to users of diesel fuel is now dispensed through the Budi Individual and Budi Agri-Commodity categories, through which eligible applicants will receive cash assistance of RM200 every month. Meanwhile, larger-scale land transport and logistics operators may apply for the subsidised diesel control system (SKDS) 1.0 and 2.0 schemes, which currently covers a total of 33 types of diesel-powered land transport vehicles.

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Mick Chan

Open roads and closed circuits hold great allure for Mick Chan. Driving heaven to him is exercising a playful chassis on twisty paths; prizes ergonomics and involvement over gadgetry. Spent three years at a motoring newspaper and short stint with a magazine prior to joining this website.

 

Comments

  • Bangkok on Jun 24, 2024 at 5:29 pm

    If compare to our neighbor still dirt cheap

    Like or Dislike: Thumb up 10 Thumb down 7
    • Dah Menang Semua on Jun 24, 2024 at 9:21 pm

      I also notice slower
      Pick-ups on the road

      Like or Dislike: Thumb up 0 Thumb down 1
    • Robinhood on Jun 25, 2024 at 8:45 am

      Simply because they are not oil producing country!!!! Compare it to Brunei….The govt can’t BS the people anymore lah….Sabah Sarawak has no rich people, smugglers or foreigners??? Don’t bluff us and we promise to show you the middle finger coming GE!!!

      Like or Dislike: Thumb up 1 Thumb down 0
    • RM1.50/L petrol mana? on Jun 25, 2024 at 10:47 am

      As above.
      PH Gomen continue to troll millions of Msians

      Like or Dislike: Thumb up 2 Thumb down 2
    • Pro-Palestine on Jun 26, 2024 at 10:52 am

      Idiot madani cybertrooper

      Like or Dislike: Thumb up 1 Thumb down 2
  • Aytrew_ on Jun 24, 2024 at 5:36 pm

    So walauns now stop drinking diesel which they used to.

    Like or Dislike: Thumb up 18 Thumb down 4
    • Casual reader on Jun 25, 2024 at 8:17 am

      Stupid logic. It just means this mini subsidy rationalisation is hitting the rakyat hard and we not even consider taking away the full diesel & ron95 subsidy. People are suffering yet this govt is blind and deaf.

      Like or Dislike: Thumb up 3 Thumb down 3
  • Sohai on Jun 24, 2024 at 8:43 pm

    30% decrease in the first week is hardly a good measure.
    Typically before price increment, everyone will already fill up the tank on the days near to increase.
    So you get:
    1. Inflated demand on the week prior
    2. Reduced demand on the 1st week.

    When you compare these 2 extremes and is only 30%, is really not a lot.

    Like or Dislike: Thumb up 2 Thumb down 1
  • rakyat biasa on Jun 25, 2024 at 9:21 am

    hopefully they have factored in the reduced sales in their earlier formula. otherwise, we have to brace for another tax/subsidy cut.

    Like or Dislike: Thumb up 0 Thumb down 0
  • ramp up your effort to improve public transport system so that people don’t have to drive everywhere they want to go

    Like or Dislike: Thumb up 1 Thumb down 0
  • sabah serawak on Jun 25, 2024 at 1:39 pm

    Sebagai rakyat Malaysia kami mau Sabah Serawak pun dinaikan harga ,apa mereka tak boleh apply bodyMandani ke?

    Like or Dislike: Thumb up 2 Thumb down 2
 

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