KUALA LUMPUR, April 4 — The surge in global crude oil prices to as high as US$120 (US$1 = RM4.02) per barrel following the conflict in West Asia is not purely driven by supply and demand, but is also influenced by geopolitical factors, shipping costs, and insurance premiums, according to Petroliam Nasional Bhd (Petronas).
President and group chief executive officer Tan Sri Tengku Muhammad Taufik Tengku Aziz said crude oil prices have risen by 40 per cent, transportation costs have increased by between 47 per cent and 176 per cent, and insurance premiums have surged by up to 337 per cent since the global energy crisis began on February 28, 2026.
“The Strait of Hormuz is a critical route, with about 20 per cent of the world’s oil supply and a large portion of global liquefied natural gas (LNG) passing through it daily.
“Disruptions here (the Strait of Hormuz) have a direct impact on the entire global economy. No one is fully insulated,” he said as a guest on Radio Televisyen Malaysia’s Bicara Naratif Khas on TV1 last night titled Addressing Challenges due to the Global Energy Crisis.
He also noted that more than 30 per cent of the world’s helium supply — a byproduct of natural gas processing — as well as 30 per cent of global fertiliser supply, including urea, potash, ammonia, and phosphate, also passed through the strait before the conflict erupted just five weeks ago.
Tengku Muhammad Taufik said that in addition to the Strait of Hormuz, disruptions to alternative oil delivery routes via Fujairah and Yanbu in West Asia have also contributed to the rising crude oil prices.
“Ship owners providing crude oil transportation services must take on risks. Insurance premiums also rise due to (ships) passing through conflict zones or areas identified as experiencing conflicts,” he said.
He noted that the crude oil prices seen on screens reflect market conditions but are not the final prices, as additional costs must be included.
“Purchases from producers must include shipping costs, insurance costs and transportation costs and, once it reaches our shores (Malaysia), logistics costs to deliver it to the (next) destination.
“So, the physical delivery price might be US$100 (per barrel), but there could be an additional US$10 or US$15 before it reaches the processing facility,” he explained.
However, he said there are still pricing mechanisms in place to protect the public from rising prices, following Malaysia’s implementation of targeted subsidies.
“In Malaysia, with targeted subsidies, along with efforts to stabilise supply, in the near term the public will be safeguarded from price surges.
“At the same time, it allows Petronas and other industry players to continue selling and fulfilling their responsibility to meet demand,” he said. — Bernama
Date: 4 April, 2026 9:00 am
Source: Malay Mail
💬 Join the Conversation! 💬
We’ve disabled comments on our posts and pages to keep the discussions organized and lively! But don’t worry – the conversation isn’t over. Head over to our forum and share your thoughts, ideas, and feedback with the community! It’s the perfect place to connect, learn, and engage with others who care about the same things. We can’t wait to hear from you!