Test-Explainer: Diesel pump prices in M'sia surge 56% after PM Anwar's subsidy reforms. Will this affect prices in S'pore?
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- Diesel fuel prices across most of Malaysia rose by more than 50 per cent on Monday (June 10), as the country’s diesel subsidy reforms officially set in
- As of Monday, the retail price of diesel fuel at all petrol stations across West Malaysia rose from RM2.15 to RM3.35 per litre
- Economists told TODAY that they foresee a moderate increase in the price of goods and services in Malaysia as a result of the reforms, though the wider impact on the country’s fiscal position is still unclear
- As for prices of goods brought into Singapore via trucks, experts say they expect a minimal impact
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SINGAPORE — Diesel fuel prices across most of Malaysia soared by more than 50 per cent, as the country slashed its diesel subsidies in West Malaysia on Monday (June 10) as part of a wider shift away from blanket subsidies.
The move effectively aligned diesel rates with market prices, as pumps across the peninsula shot up from RM2.15 (S$0.61) to RM3.35 (S$0.96) per litre — a 56 per cent increase.
Economists told TODAY that they foresee a moderate increase in the price of goods and services in Malaysia as a result of the reforms, though the wider impact on the country’s fiscal position is still unclear.
As for prices of Malaysian goods imported into Singapore via its land border, experts say they expect a “minimal” impact.
Explaining the move last month, Malaysia’s Prime Minister Anwar Ibrahim said the cuts are part of his plan to focus aid for low-income groups in the country by restructuring its wide-ranging subsidies, which he argued had benefitted the ultra-rich as their consumption or spending on goods and services is greater.
Fuel, cooking oil, and rice, as well as other basic items, are heavily subsidised in Malaysia, which has seen its subsidy bill rise to record levels in recent years.
The country’s diesel subsidies alone surged almost 10-fold from RM1.4 billion (S$400 million) in 2019 to RM14.3 billion (S$4.08 billion) in 2023.
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