Malaysia Increases Unsubsidised RON97, RON95 and Diesel Fuel Prices

Malaysian consumers are facing another round of fuel price hikes as international geopolitical instability continues to ripple through domestic markets. The Ministry of Finance (MOF) confirmed on Wednesday that unsubsidised RON97 will now retail at RM4.20 per litre, while unsubsidised RON95 is set at RM3.62 per litre. Unsubsidised diesel has seen a sharper increase, moving to RM4.42 per litre.

Global Market Volatility and the Strait of Hormuz

The government attributes these latest price adjustments to significant movements in the global petroleum market over the preceding week. Brent crude oil prices surged by 16 per cent following the end of the Middle East war’s ceasefire and the subsequent escalation of hostilities between the United States and Iran.

The MOF has identified critical bottlenecks in international shipping as a primary driver of this volatility. Restrictions on shipping and reduced vessel traffic through the Strait of Hormuz have heightened concerns over disruptions to global petroleum supplies, and the rise in crude oil prices was also driven by tightening global inventories and the threat of disruptions to oil shipments from Saudi Arabia, the ministry noted in its statement. Brent crude was trading between US$84.78 and US$93.77 per barrel during the mid-week period.

Protection for Subsidised Fuel Consumers

Despite the upward pressure on market-rate fuels, the government has maintained price stability for targeted groups. Under the BUDI95 scheme, RON95 remains priced at RM1.99 per litre, while diesel under the BUDI Diesel initiative is fixed at RM2.10 per litre. Similarly, fuels under the Subsidised Petrol Control System (SKPS) and Subsidised Diesel Control System (SKDS) are held at RM2.05 and RM2.15 per litre, respectively.

This marks the second consecutive week of price increases for unsubsidised RON95 and diesel, following an earlier hike for the July 16–22 period where prices rose by five sen for RON95 and 10 sen for diesel. The current pricing structure is scheduled to remain in effect until July 29.

Government Outlook on Market Stability

Finance officials remain cautious regarding the near-term outlook for fuel costs. The ministry underscored that the global petroleum market is expected to remain unsettled until the current conflict reaches a formal resolution.

“The global petroleum market is expected to remain volatile until the conflict is resolved. Although efforts to revive negotiations and proposals for another ceasefire have limited some of the price increases, they have yet to ease market concerns over the risk of supply disruptions.”

Ministry of Finance, official statement

To mitigate the impact on national subsidy expenditure, the government has urged the public to exercise prudence in fuel consumption. This includes planning travel more efficiently and reducing unnecessary journeys. While current domestic supplies are described as sufficient, the government continues to prioritize a cautious approach to shield the general population from price fluctuations in the global energy market.