50% of our oil supply passes through Hormuz strait, says PM

2026-03-22 - 05:40

Prime Minister Anwar Ibrahim said Malaysians and the majority of traders do not have to pay the market rate for fuel because of government subsidies. (Bernama pic) PETALING JAYA: Prime Minister Anwar Ibrahim has sought to explain why Malaysia has been affected by the surge in oil prices amid the Iran war despite being an oil-producing nation. Anwar, who is also the finance minister said Malaysia remained a net oil importer while nearly 50% of the country’s supply of oil passes through the Strait of Hormuz. “To protect Malaysians, government subsidies have gone up from RM700 million (a month) to RM3.2 billion. “The people and the majority of traders do not have to pay the market rate because of these subsidies which are being channelled through the BUDI95 and BUDI diesel schemes. “Amid global uncertainty, the Madani government’s priority is protecting the welfare and wellbeing of the people,” he said in a Facebook post. The government had raised the price of RON97 petrol by RM1.30 in the past two weeks while diesel in West Malaysia has gone up by RM1.60. The price of non-subsidised RON95 has also gone up by 60 sen. Putrajaya estimates that keeping the subsidised fuel prices will increase its monthly fuel subsidy bill to RM3.2 billion, comprising RM2 billion for RON95 and RM1.2 billion for diesel, which continues to be sold at a subsidised price in East Malaysia. Iran closed the Strait of Hormuz following the US-Israel strikes earlier this month, leading to crude oil surging to around US$100 per barrel.