Malaysian deputy finance minister Liew Chin Tong has said that the government projects to spend about RM2 billion and RM1.5 billion a month to subsidise RON 95 petrol and diesel respectively, if crude oil prices remain at around US$90 (RM368) a barrel, Bernama reports.
“The government also earns revenue from petroleum. Every US$1 (RM4) increase in the price of oil per barrel is expected to generate an additional RM300 million in government revenue,” Liew said, adding that so far, Malaysia’s fiscal position remains strong and fiscal projections are unchanged despite the increase in crude oil prices.
“In October, when prime minister Datuk Seri Anwar Ibrahim presents the 2027 Budget, the government will announce updated fiscal projections based on the prevailing economic conditions at that time,” he said.
He was responding to Senator Datuk Dr Mohd Na’im Mokhtar, who asked today in the Dewan Negara if the government is confident of maintaining its fiscal deficit target should global crude oil prices exceed current projections, and what contingency plans have been made to address such a situation.
From just RM700 million in January, Malaysian fuel subsidies ballooned to RM5 billion in March before peaking at RM7.5 billion the following month, due to the rise in global oil prices brought about by the ongoing West Asian conflict.
Regarding a proposal to raise the Budi Diesel quota for Sabah and Sarawak, the deputy finance minister said the government is prepared to consider applications from specific groups. “As an example, pick-up truck owners have been granted an additional quota of 100 litres through a very simple application process. If there are specific cases that warrant consideration, the government is prepared to review them,” he said.
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