How much annual savings does the diesel subsidy reform aim for?

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Diesel Subsidy Reform Aims for RM2 Billion in Annual Savings

The diesel subsidy reform is projected to generate annual savings of up to RM2 billion for the government. This initiative introduces a system using the MyKad for subsidised diesel purchases and implements uniformed pricing across the nation.
Combating Smuggling Activities

The reform is being implemented in response to significant diesel smuggling operations, particularly concentrated in the east coast states. These illicit activities have led to inflated sales figures, with diesel sales in Sabah and Sarawak during March and April 2026 reaching an estimated 200 million litres per month, which is double the anticipated volume based on registered diesel vehicles.
Introduction of Uniformed Pricing

A key component of the reform is the establishment of uniformed pricing for diesel. This measure aims to streamline the subsidy distribution and prevent price disparities that can facilitate smuggling.
Reduction in Subsidised Diesel Price

The anticipated savings from the subsidy reform will allow for a reduction in the price of subsidised diesel. The price is set to decrease to RM2.10 per litre from the current RM2.15 per litre, offering a benefit to eligible Malaysian citizens.

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How much annual savings does the diesel subsidy reform aim for?

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