Malaysia’s Economy Minister Rafizi Ramli has announced that the government is considering implementing a two-tiered pricing system for RON95 petrol subsidies. However, the exact mechanism is still under discussion, with input from various stakeholders, including the Petrol Dealers Association.
Rafizi explained that earlier proposals involved providing cash payments to families, which would not have involved petrol stations or a tiered pricing system. The current deliberations focus on determining how best to redirect subsidy savings, whether through cash payments or direct subsidies to benefit the 85% of the population who are expected to continue receiving subsidies.
Prime Minister Datuk Seri Anwar Ibrahim, who also serves as the Finance Minister, had previously stated that targeted subsidies for RON95 would be implemented by mid-2025, with assurances that most of the population would still receive benefits. The government subsidised RON95 petrol by approximately RM20 billion in 2023 alone.
Rafizi also pointed out that the mechanism for RON95 will differ from that of diesel, which uses a fleet card system. Given the impracticality of issuing fleet cards to Malaysia’s entire population, alternative methods are being explored by the Economy and Finance Ministries.
