Finance Minister II Datuk Seri Amir Hamzah Azizan (left) and Bank Negara Malaysia (BNM) governor Datuk Shaik Abdul Rasheed Abdul Ghaffour at BNM’s Sasana Symposium 2024 on Wednesday. (Photo by Zahid Izzani/The Edge)

KUALA LUMPUR (June 12): The government will only decide on subsidy rationalisation for RON95 petrol after the process for diesel has been completed, according to Finance Minister II Datuk Seri Amir Hamzah Azizan.

“For now, we are focusing on diesel first,” Amir Hamzah told reporters on Wednesday at Bank Negara Malaysia’s (BNM) Sasana Symposium 2024.

“Once it’s stable, we will see what else we need to do,” Amir said when asked to comment on a research firm’s view that the government should implement the RON95 petrol subsidy rationalisation to achieve the RM4.1 billion target savings in the second half of 2024.

On Tuesday (June 11), Maybank Investment Bank (Maybank IB) wrote in a note that if the government wanted to achieve the RM4.1 billion savings, the targeted RON95 petrol subsidy should start on July 1, with the retail price of RON95 raised by 32 sen per litre or 15.6%.

This comes after the government enforced the new retail price for diesel in Peninsular Malaysia at RM3.35 per litre (up RM1.20 from previously) effective Monday (June 10). The retail price of diesel fuel for Sabah, Sarawak and Labuan remains at RM2.15 per litre.

BNM welcomes diesel subsidy rationalisation

Bank Negara Malaysia (BNM), meanwhile, welcomed the rationalisation of the diesel subsidy, according to central bank governor Datuk Shaik Abdul Rasheed Abdul Ghaffour.

Abdul Rasheed said the move is seen as a positive step towards more equitable, sustainable policies, while building fiscal policy space.

“We cannot, nor should we assume that this window [of opportunity for reforms] will not soon close upon us. We need to come together to make reforms a reality for Malaysia,” he said in his welcoming address.