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Prime Minister Datuk Seri Anwar Ibrahim announced today, 4 May, that Malaysia’s monthly fuel subsidy has risen dramatically to approximately RM5 billion
This substantial increase is attributed to the impact of rising global oil prices and supply chain disruptions resulting from the ongoing conflict in Iran.
This current figure represents a sharp escalation from the RM700 million — approximately 7.14 times — monthly subsidy that was recorded before the outbreak of the conflict, highlighting the growing fiscal pressure on the government, according to Bernama.
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The surge in subsidy costs is directly linked to the rise in global crude oil prices, which have climbed from around USD70 (RM312) per barrel to approximately USD115 (RM512) per barrel
This price spike is a direct consequence of disruptions in the Strait of Hormuz, a vital global shipping route, where escalating tensions have hindered the movement of oil tankers and tightened energy supplies.
Despite these challenges, Anwar emphasised that Malaysia’s fuel supply remains relatively stable
He credited the nation’s strong diplomatic and trade relationships with other countries for securing continued access to essential energy resources.
The government is expected to continue monitoring the situation closely as geopolitical tensions persist, with the rising subsidy bill posing potential implications for Malaysia’s overall fiscal position in the coming months.