Malaysia Maintains Fuel Subsidy

After the ruling coalition suffer its worst ever election setback in Malaysia, fuel prices are kept unchanged under energy subsidies review to find ways to curb waste and fuel smuggling.

Cheap energy has turned Malaysians' addiction to subsidised fuel has led to pollution and waste in which the Malaysian government wanted to keep the fuel pump price level at the same level at Ringgit 1.90 ($0.65 / litre) but at the same time reducinge the subsidy by improving the system.

The government's ultimate target is that the subsidy becomes more targeted, more focused and goes to the groups who actually deserve it aiming at lower-income Malaysians and the transport sector to help keep retail prices down. At $110 per barrel, Malaysia government is spending 18 billion ringgit ($5.70 billion) to maintain fuel subsidies. Moreover, Malaysian's cheap fuel price has increased fuel smuggling to neighbouring Thailand and Singapore.