Higher oil prices may push petrol, diesel subsidies to RM3.5b monthly, says Liew Chin Tong

KUALA LUMPUR, July 22 — The government estimates that the RON95 petrol subsidy will reach approximately RM2 billion per month, while the diesel subsidy will amount to about RM1.5 billion per month, if crude oil prices remain at around US$90 per barrel based on current projections.

Deputy Finance Minister Liew Chin Tong said that, so far, the country’s fiscal position remains strong and fiscal projections are unchanged despite the increase in crude oil prices.

“The government also earns revenue from petroleum. Every US$1 increase in the price of oil per barrel is expected to generate an additional RM300 million in government revenue.

“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 during the question-and-answer session in the Dewan Negara today.

Liew was responding to a supplementary question from Senator Datuk Dr Mohd Na’im Mokhtar on whether the government remains confident it can maintain its fiscal deficit target if global crude oil prices rise above current projections, and what contingency plans have been prepared to address such a scenario.

In response to another supplementary question from Senator Datuk Anna Bell @ Suzieana Perian regarding a proposal to increase the BUDI Diesel quota for Sabah and Sarawak, he said the government is prepared to consider applications from specific groups.

“As an example, pickup 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. — Bernama