Malaysia to lower subsidized diesel price to RM2.10 per liter nationwide from July

The Malaysian government will lower the price of subsidized diesel for its citizens to RM2.10 per liter across the country, effective from July. This price adjustment is part of a renewed targeted subsidy mechanism that will be uniformly applied nationwide, utilizing MyKad identity card verification.

The Ministry of Finance (MOF) stated that this approach aligns with the methodology used for RON95 petrol subsidies under the Budi Madani program. The reform ensures that all Malaysian citizens will benefit from the same price and method of subsidy distribution. Subsidies will be directly channeled to citizens upon MyKad verification, while non-citizens and those not eligible will be required to purchase diesel at the unsubsidized rate.

This move is crucial for ensuring that government subsidies are exclusively for Malaysian citizens and to curb the significant leakage and smuggling of subsidized diesel. The substantial price difference between subsidized and unsubsidized diesel has created opportunities for illicit activities, including smuggling the fuel out of the country.

Currently, diesel is sold at a subsidized retail price of RM2.15 per liter in Sabah and Sarawak, contrasting with the unsubsidized price of RM4.37 per liter in Peninsular Malaysia. The new reform will harmonize the retail diesel price in Sabah and Sarawak with that of Peninsular Malaysia. Consequently, non-citizens will no longer receive diesel subsidies, and diesel vehicle users in Sabah and Sarawak will see a price reduction from RM2.15 to RM2.10 per liter.

Further details regarding the implementation of this targeted diesel subsidy reform will be announced by the Second Finance Minister, Datuk Seri Amir Hamzah Azizan, on the following day.