PUTRAJAYA: The Economy Ministry is closely monitoring the ongoing conflict in Iran to assess its broader macroeconomic impact on the country, particularly concerning inflation and supply chain disruptions, says Akmal Nasrullah Mohd Nasir (pic).
The Economy Minister said the immediate effect of the conflict involves global oil supplies and prices, a matter closely managed by the Finance Ministry due to its impact on domestic subsidies.
“When we talk about this issue, the effects go beyond just a rise in oil prices. The magnitude of the impact depends heavily on the intensity of the conflict and how long it persists.
“We have stated previously that these circumstances are within our expectations and observation,” said Akmal Nasrullah to reporters during a press conference at the Putrajaya International Convention Centre (PICC) on Thursday (March 12).
Akmal Nasrullah said that based on current indications, the Middle East conflict would not be resolved quickly, adding that economic recovery will take time once the dust settles.
“Even if the conflict ends, it does not mean that everything will return to normal. Some matters will require more time to fully recover,” said Akmal Nasrullah.
As such, he said the Economy Ministry is keeping a close watch on key economic indicators that could be affected by the conflict, including inflation, supply chain stability and overall transportation costs.
According to Akmal Nasrullah, the core function of the Economy Ministry is to look at the macroeconomic picture and frame Malaysia’s economic growth, which involves long and medium term planning such as the 13th Malaysia Plan (13MP).
As of March 12 morning, Brent crude oil price increased to US$100 per barrel after dropping initially to US$91 per litre on Wednesday.
On Monday, Brent crude oil price surged past US$100 per barrel, the highest increase in decades.
The fluctuation in crude oil prices followed Iran's closure of the Straits of Hormuz on Monday following escalating attacks by the US and Israel.
