KUALA LUMPUR: More than 14.2 million out of 16.7 million people who are eligible for the Budi Madani RON95 (BUDI95) subsidy have benefitted from the programme, involving the consumption of more than 13.4 billion litres of RON95 fuel, said Finance Minister II Datuk Seri Amir Hamzah Azizan.
He said that the unsubsidised RON95 price, which fluctuates according to market prices, applies only to buyers who are not eligible for the subsidy, including non-citizens and those who do not meet the BUDI95 eligibility criteria.
"Based on actual BUDI95 usage data from October 2025 to June 2026, fewer than one per cent of BUDI95 users consistently consume more than 200 litres of RON95 per month.
"On average, RON95 consumption is around 100 litres per month," he said during the question-and-answer session in the Dewan Negara today.
He was responding to a question from Senator Datuk Bobbey Ah Fang Bin Suan regarding the annual cost savings resulting from the implementation of the targeted RON95 subsidy.
Amir Hamzah explained that, based on the current implementation, annual fiscal savings are estimated at between RM2.5 billion and RM4.0 billion, subject to global crude oil prices, exchange rate movements, and actual fuel consumption patterns.
Responding to a supplementary question from Senator Robert Lau Hui Yew regarding the Organisation for Economic Co-operation and Development’s (OECD) recommendation that Malaysia gradually phase out BUDI95 and adopt other policy mechanisms over the medium term, Amir Hamzah said the government has already shifted to a targeted subsidy system from the previous blanket fuel subsidy.
"The BUDI95 eligibility framework allows Malaysian citizens to receive subsidised RON95 for up to 200 litres, while non-citizens do not receive this subsidy. This has saved the government’s fiscal space.
"We fully understand that the OECD has recommended the withdrawal of all subsidies, but we cannot do that in this country. What is important is that we provide subsidies in a targeted manner rather than making abrupt changes as suggested by the OECD," he said.
The OECD, which is headquartered in France, has recommended that Malaysia gradually eliminate fuel subsidies.
The global economic policy think tank said that this measure is necessary to strengthen the government's financial position as Malaysia moves closer to achieving high-income nation status. - Bernama
