The government has reportedly spent up to RM2.2 billion for the Subsidised Diesel Control Scheme (SKDS) in March 2026 alone, which is nearly three times more than the previous RM700 million expenditure in February this year.
This was revealed by the domestic trade and cost of living minister (KPDN), Datuk Armizan Mohd Ali, who told Bernama that this surge in subsidies expenditure was due to the escalating global diesel prices triggered by the ongoing conflict in West Asia.
“As an example, on February 26, global diesel prices stood at US$ 93 (about RM375) per barrel, compared with US$ 239 (RM964) per barrel on March 31, representing an increase of 158%. Based on projections following the current upward trend, the monthly allocation required for the implementation of SKDS is estimated at RM2.2 billion compared with RM3.45 billion spent annually in 2025,” he said.
Govt to Continue SKDS Programme Despite Price Hike
Armizan continued that the government remains committed to continuing the targeted diesel subsidy programme, and that is despite the diesel fuel price increasing amid the ongoing tension in Iran, which has triggered a global energy crisis.
“Under the SKDS, a total of 33 types of vehicles are eligible for subsidised diesel, comprising 10 categories of public land transport vehicles and 23 categories of goods transport vehicles. Registered vehicles can benefit from subsidised diesel at a rate of RM1.88 per litre for public land transport vehicles and RM2.15 per litre for goods transport vehicles,” the KPDN minister explained.
On claims by petrol station operators regarding the burden of purchasing fuel supply upfront, Armizan said the ministry would discuss the matter with the Finance Ministry (MOF).
“Among the approaches we are considering is to discuss with the finance ministry how to expedite reimbursement payments so that operators can receive them promptly. We also hope operators will take their own contingency measures so that all parties can sustain operations amid the global energy crisis,” he said.
