Lowering Budi95 monthly quota to 200 litres is right step in fuel crisis; T10, T20 use more – World Bank

World Bank lead economist for Malaysia Dr Apurva Sanghi has said that the downwards adjustment of the Budi Madani RON 95 (Budi95) monthly quota is a step in the right direction amidst the West Asia crisis, as the government seeks to better manage fiscal pressures while ensuring subsidies are more efficiently distributed, Bernama reports.

“Fuel subsidies in Malaysia are regressive, with the T10, T20 benefitting much more compared to others. And if you look at who consumes most of the fuel, it is the T10, T20 segment. In fact, they have been known to consume more than 200 litres.

“So now that the quota is temporarily adjusted to 200 litres, I think it is absolutely OK in terms of addressing the aggressivity that they pay more. That is definitely a step in the right direction,” he said at today’s briefing on Part 1 of the World Bank’s April 2026 Malaysia Economic Monitor, titled ‘Raising the Ceiling, Raising the Floor, Advancing Malaysia’s Jobs and Productivity Agenda’.

The quota cut is a short-term measure, and if the fiscal situation worsens, further adjustments may be needed, he noted. The government is currently subsidising petrol and diesel to the tune of some RM4 billion a month.

Lowering Budi95 monthly quota to 200 litres is right step in fuel crisis; T10, T20 use more – World Bank

According to a separate Bernama report, Sanghi also said that Malaysia does not need stimulus amidst the crisis. “As of now, there should be no stimulus. Providing a stimulus now would only add to the inflationary impulse.

“Stimulus is (only needed) if inflationary fears snowball into growth concerns like we saw happen during the COVID-19 crisis,” he said, adding that Malaysia’s inflation remains stable and contained for now at 1.6% in January.

While inflationary pressures, which arise not just from direct oil prices but also from other goods and services consumed, could emerge, Sanghi said the government’s policies and measures are helping the public cope with the situation.

“There are ways to manage demand on that front as well, and the government has announced certain policies. As of now, all the data and evidence point towards inflation continuing to remain stable,” he said.

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