Petrol prices rarely affect just the cost of filling up your car. When global oil supply is disrupted, the effects often appear later in delivery fees, food prices, and everyday goods. That risk is now emerging after the closure of the Strait of Hormuz, one of the world’s most important oil shipping routes.

Prime Minister Datuk Seri Anwar Ibrahim says Malaysia can still maintain the subsidised RON95 petrol price at RM1.99 per litre for another one or two months. However, he warned that a prolonged disruption could eventually raise costs across the economy.

RON95 Price Remains Stable For Now

Malaysia’s most widely used petrol grade remains fixed at RM1.99 per litre under the government’s fuel subsidy programme.

According to Anwar, the government still has room to keep the current price unchanged for about one to two months while it monitors global developments. This means motorists are unlikely to see any immediate changes at petrol stations, as the government continues absorbing the difference between global oil prices and the price consumers pay locally.

However, sustaining that price becomes more expensive when global crude oil prices rise. If supply disruptions push oil prices higher for an extended period, the government’s cost of maintaining the subsidy will increase as well.

Strait Of Hormuz Closure Disrupts Global Oil Flow

The immediate concern stems from the Strait of Hormuz, a narrow shipping route between Iran and Oman that serves as the main exit point for oil from the Gulf.

Roughly 20% of the world’s oil supply moves through this passage, making it a choke point in global energy trade.

Iran closed the strait earlier this week following attacks by the United States and Israel. Reports indicate that more than 200 oil and gas vessels are currently stranded in the area.

If the closure continues, ships transporting oil and gas will have to take longer alternative routes. These longer journeys increase shipping costs and slow the flow of global oil supply, which can push crude oil prices higher.

When that happens, governments that subsidise fuel, including Malaysia, must spend more to maintain stable pump prices.

Higher Shipping Costs Could Feed Into Consumer Prices

Even if Malaysia temporarily maintains the RON95 price, the wider economy may still feel the effects of higher transportation costs.

The price of Brnet crude oil has almost doubled in one week, whatever happens now it is likely that  shipping costs for goods moving through international supply chains are going to increase

Businesses that rely on imported materials or products, particularly small and medium enterprises, could see their operating costs increase. Those higher costs often appear in retail prices.

Imported food, packaged goods, and household items are typically among the first categories where rising shipping and logistics costs become visible. The impact tends to build gradually rather than appearing all at once.

Economic Growth Outlook Already Under Review

The government is also reassessing Malaysia’s economic outlook as global uncertainty rises.

Finance Minister II Datuk Seri Amir Hamzah Azizan said earlier that Malaysia may revise its official growth forecast of 4% to 4.5% due to the risks linked to the Middle East conflict.

Prolonged disruption to global energy supply can raise business costs, slow trade flows, and affect investment decisions, all of which influence overall economic growth.

Fuel Subsidy Pressure Could Increase If Disruption Persists

For now, Malaysia’s fuel subsidy system continues to shield drivers from sudden petrol price changes.

However, that protection has limits. If global oil supply remains disrupted and crude prices stay elevated, the government will need to spend more to maintain the RM1.99 RON95 price.

For the moment, the government maintains that it can hold the current RON95 price while monitoring global developments, although much will depend on how quickly oil shipments through the Strait of Hormuz return to normal.

Follow us on our official WhatsApp channel for the latest money tips and updates.