West Asia conflict could add RM1.1 billion to construction diesel costs

Escalating tensions and ongoing conflict in West Asia, particularly involving the United States, Israel, and Iran, pose a significant financial risk to Malaysia's construction sector. Industry experts predict that the prolonged conflict could inflate the nation's construction diesel bill by as much as RM1.1 billion by 2026.

Kashif Ansari, Co-Founder and Group CEO of Juwai IQI, stated that this projection hinges on the assumption that average market diesel prices will remain elevated at levels seen since the conflict's onset. The volatile geopolitical situation directly influences global oil prices, which in turn affects the cost of fuel for construction machinery and transportation within Malaysia.

The potential RM1.1 billion increase represents a substantial burden for the construction industry, which relies heavily on diesel for its operations. This added cost could lead to project delays, increased material prices, and potentially impact the overall economic growth dependent on infrastructure development.