At least 6.5m litres of diesel smuggled out of Malaysia daily, misappropriated before subsidy reform – MoF

At least 6.5m litres of diesel smuggled out of Malaysia daily, misappropriated before subsidy reform – MoF

The government had always asserted that diesel subsidy rationalisation is to stem leakage, and that much of our diesel is smuggled out of the country due to the big difference in the fuel’s price between Malaysia and its neighbours. Now, we have some figures and they’re mind-bogglingly massive.

According to finance minister II Datuk Seri Amir Hamzah Azizan, at least 6.5 million litres of diesel were misappropriated by industries or smuggled into neighbouring countries daily before targeted diesel subsidy was implemented.

June 10 was the day that Malaysia’s diesel pump price jumped 56% to RM3.35 per litre overnight, and subsidy reform resulted in a 23%, or 6.5 million-litre, reduction in daily sales at petrol stations in Peninsular Malaysia, Amir Hamzah said, noting that in early June, average daily diesel sales was 28.6 million litres. Early this month, it has dropped to 22.2 million litres.

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There’s also another trend. “This conclusion is supported by data showing that daily commercial diesel sales have increased by 4.8 million litres over the same comparison period. Given that the current price at petrol stations is RM3.35 per litre, industries that previously purchased subsidised diesel have now switched to commercial diesel,” the senator told Dewan Negara yesterday, reported by Bernama.

The drop in diesel sales is even more apparent in the northern Peninsular Malaysia states. Amir Hamzah said that some petrol stations near the Thai border have experienced a drop in diesel sales of up to 40 to 50% since targeted subsidy started. “This situation reflects a decrease in smuggling activities to the neighbouring country due to reduced profit margins for smugglers,” he added.

Earlier this month, domestic trade and cost of living (KPDN) minister Datuk Armizan Mohd Ali said cases of diesel seizure are down by 87%, based on cases in the 20 days prior to June 10, and the 20 days after that.

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Danny Tan

Danny Tan loves driving as much as he loves a certain herbal meat soup, and sweet engine music as much as drum beats. He has been in the auto industry since 2006, previously filling the pages of two motoring magazines before joining this website. Enjoys detailing the experience more than the technical details.

 

Comments

  • Winston on Jul 24, 2024 at 9:51 am

    Since the smuggling/misappropriated diesel has stopped, now can the government let us genuine diesel car owner have access to subsidised diesel

    Like or Dislike: Thumb up 1 Thumb down 0
  • fudgemesideways on Jul 24, 2024 at 10:08 am

    Instead of telling us for the past few wks how much we lost before the subsidy cut, why dont u tell us multiple times where all the money will be invested. I see our national school still dilapidated and healthcare still cutting spending. So much so, my son’s school is asking parents for A4 paper donations.

    Like or Dislike: Thumb up 2 Thumb down 0
  • MassivelyAnnoyed on Jul 24, 2024 at 1:07 pm

    And yet there will be people who complain that their business survives all this year by utilising subsidised diesel illegally.

    Like or Dislike: Thumb up 0 Thumb down 0
  • lalala on Jul 24, 2024 at 2:14 pm

    6.5mil liter per day is equivalent to almost 200 unit of big oil tanker lorry like petronas/shell to cross border daily because 1 tanker can hold around 30k liter of oil. What law enforcement do at border when see hundreds of this lorry everyday? Even if modified 4×4 or boat is used to smuggle, how many liter they can hold at one time? For sure, the quantity of 4×4 or boat needed to really smuggled all the oil make it obvious at borders there..

    Like or Dislike: Thumb up 3 Thumb down 0
  • Kenapa tak bandingkan harga kereta skali?

    Like or Dislike: Thumb up 0 Thumb down 0
  • Jetson Leong on Jul 24, 2024 at 5:34 pm

    don’t fool people, spore diesel at RM8.79 is merely SGD2.5+ and they are earning spore dollars, please compare apple to apple who is more expensive when you are earning RM but you are paying RM3.35

    Like or Dislike: Thumb up 14 Thumb down 7
  • This data should also tells govt which petrol stations sales dropped significantly, and there may be linked to smuggler? Or just close case like this and people start suffering with inflation?

    Like or Dislike: Thumb up 11 Thumb down 0
  • Suren on Jul 25, 2024 at 1:01 am

    Please compare price data against oil producing countries

    Like or Dislike: Thumb up 1 Thumb down 0
  • Spin Too Much on Jul 25, 2024 at 1:01 am

    Yeah right and millions of rakyat has to suffer just to punish a few smugglers now. And yet they change tactic going to smuggle RON95 because they weren’t caught. So how does this stupid subsidy rationalisation help to prevent smuggling huh?

    Like or Dislike: Thumb up 2 Thumb down 0
  • Robinhood on Jul 25, 2024 at 8:54 am

    Yalah yalah….Keep on with your attempt to bluff the nation. Sabah Sarawak has no smugglers, T20 and foreigners!!!!

    Like or Dislike: Thumb up 0 Thumb down 0
  • anwar menang. rakyat dikencingkan on Jul 25, 2024 at 10:31 am

    The government had always asserted that diesel subsidy rationalisation is to stem leakage..

    In other words the gov is telling the people that they have HAD no will power for 65 years to stop the smuggling and therefore have to make life difficult for the rest of us!!

    Like or Dislike: Thumb up 1 Thumb down 0
  • anwar menang, rakyat dikencingkan on Jul 25, 2024 at 10:40 am

    https://focusmalaysia.my/netizens-praised-for-viral-effect-trigger-in-exposing-ron95-cheats-by-spore-thai-registered-cars/

    leakages still happening but no action on the station owners!!
    set a precedent… fine them RM100 million…

    Like or Dislike: Thumb up 1 Thumb down 0
  • Eric Khoo on Jul 25, 2024 at 10:49 am

    As a very concerned citizen, who wants to contribute to the country, I have been trying and trying unsuccessfully to present MY targeted fuel subsidy management solution to the govt that addresses the weaknesses in our subsidy mechanism (whether blanket or recently rolled out rationalisation).

    IF ONLY I CAN GET AN INVITATION BY BUDI MADANI OR ANY CONCERNED AND RELATED GOVT SERVICE PERSONELL TO SHOWCASE MY SOLUTION.

    It is NOT about making money BUT about what I want to do for my country.

    0126540180

    Like or Dislike: Thumb up 0 Thumb down 0
  • Karim on Jul 25, 2024 at 11:17 am

    6.5m daily equivalent to 145 units of super tanker (45000L)crossing our border.
    Are you sure bro?

    Like or Dislike: Thumb up 0 Thumb down 0
  • The fact tgat it took so long for gomen to realise this makes me suspect yop leaders are also involved in smuggling or at least, manipulating sales of subsidise diesel.

    Like or Dislike: Thumb up 0 Thumb down 0
  • Mogon a/l balaraman on Jul 25, 2024 at 7:50 pm

    Toyata hulex

    Like or Dislike: Thumb up 0 Thumb down 0
  • The data isn’t true at all. Usually i drove with 4 tank full of diesel every month. The subsidy only cover like less than 2tank. So government says my other 2.5tank are smuggle out. This is absurd.

    Like or Dislike: Thumb up 3 Thumb down 0
 

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