December 4, 2025
Local
Local
PUTRAJAYA, Oct 19 — The 300-litre monthly petrol subsidy limit under the Budi Madani RON95 (Budi95) programme is sufficient for normal personal use, according to Treasury secretary-general Datuk Johan Mahmood Merican.
Citing government data, Johan said 95 per cent of Malaysians consume less than 180 litres of petrol a month, while fewer than 0.7 per cent use over 300 litres for personal purposes.
“On average, Malaysians use around 80 litres per month. Based on current data, the 300-litre quota is adequate, though we will continue to monitor the situation,” he told Bernama in an exclusive interview.
In the first two weeks of October 2025, fewer than 0.1 per cent of eligible Malaysians had fully used their 300-litre quota, a figure Johan described as too small and too early to suggest the quota is insufficient.
He cautioned that raising the quota could increase risks of subsidy leakages, such as smuggling activities. “When we analysed the data, some of those who fully utilised their quota were from border states. Among them were over 80 individuals with only motorcycle licences who had already used up their 300 litres — implying over 500km of riding daily,” he revealed.
Launched in stages since September 27, Budi95 allows Malaysians aged 16 and above with a MyKad and valid driving licence to enjoy subsidised RON95 petrol at RM1.99 per litre, capped at 300 litres per month. Johan said the system has been running smoothly, with nearly three million transactions recorded daily and over 12 million Malaysians already purchasing RON95 at the subsidised rate.
RM2.5b in savings to fund development and welfare
Johan added that the estimated RM2.5 billion in fiscal savings from the rationalisation of RON95 subsidies under Budi95 will be redirected toward development projects and welfare programmes.
He stressed that the government’s targeted subsidy approach is not just a cost-cutting measure but aims to ensure public funds are used more effectively for national development priorities.
According to data from the Department of Statistics Malaysia, households account for about 78 per cent of RON95 consumption. “Out of 18 billion litres used annually, about four billion litres are consumed by non-household users — likely companies, foreigners, or through smuggling,” he said.
“This 20 per cent represents potential savings. Taking 20 per cent of the RM20 billion subsidy cost in 2023 and 2024, the savings amount to roughly RM4 billion when oil prices are high,” he explained.
With oil currently around US$60 per barrel (US$1 = RM4.23), the government expects annual savings of about RM2.5 billion.
Johan said the targeted subsidy model reflects responsible fiscal management, which can strengthen investor confidence. “The government seeks to balance fiscal discipline with adequate support for the economy — sustaining growth, creating business and job opportunities, and improving income for the rakyat,” he added. — Bernama
