Malaysia expects billions in petrol subsidy savings — here’s where the money will go

Finance Minister II Datuk Seri Amir Hamzah Azizan said BUDI95 is projected to generate annual savings of up to RM4 billion, with the final figure for 2026 to be determined by year-end. — Bernama pic

First Published: Wednesday, 28 Oct 2026 12:29 PM MYT

KUALA LUMPUR, Oct 28 — The total fuel subsidy savings for this year will be finalised by year-end, taking into account actual transaction adjustments, weekly market prices, currency exchange rates, and verified consumption volumes. 

Finance Minister II Datuk Seri Amir Hamzah Azizan said that from a fiscal perspective, the implementation of BUDI95 is expected to generate total savings of between RM2.5 billion and RM4 billion annually. 

“The savings are the result of the comprehensive implementation of targeted subsidies, which includes reducing leakage, such as benefits reaching non-citizens and ineligible consumer categories, as well as curbing expenditures that do not align with the government’s social protection objectives. 

“The government will continue to ensure that these savings are repurposed to strengthen targeted assistance, such as the Sumbangan Tunai Rahmah and Sumbangan Asas Rahmah, as well as other initiatives that provide direct benefits to the people,” he said. 

He was replying to a question from Muhammad Fawwaz Mohamad Jan (PN-Permatang Pauh), who had asked the Finance Minister to state the actual amount of fuel subsidy savings for the year, in the Dewan Rakyat today. 

Amir Hamzah stated that the government consistently adopts a responsive, data-driven approach, including continuous monitoring of developments in global energy supply and market prices, the nation’s fiscal position, and public feedback. 

“Following more stable fuel supply conditions and current subsidy expenditure of approximately RM4 billion per month, the government is reinstating the BUDI95 eligibility limit to 300 litres per month, effective September 1, 2026. 

“The previous adjustment from 300 litres to 200 litres was an initial, targeted measure to ensure the nation’s fuel supply remains secure amidst global supply uncertainties resulting from the conflict in West Asia,” he said. — Bernama