Study on Budi95-like mechanism for diesel subsidy to be tabled next week

The Finance Ministry has been instructed to study the implementation of targeted diesel subsidies using a mechanism similar to the Budi95 scheme for RON95 petrol, said government spokesperson Fahmi Fadzil.

Fahmi (above) said that during today’s cabinet meeting, Prime Minister Anwar Ibrahim had requested that the Finance Ministry review the matter.

“The Finance Ministry will be required to present its findings to either the National Economic Action Council or the cabinet in the coming week,” the communications minister said during a post-cabinet meeting press conference today.

He added that the MyKad-linked method under the Budi95 initiative is “simpler, more efficient, and effective."

On April 8, Finance Minister II Amir Hamzah Azizan said Putrajaya is studying the use of MyKad in the distribution of targeted diesel subsidies, following the method’s success in distributing RON95 petrol subsidies.

Amir also said the use of MyKad under the Budi95 scheme had managed to reduce leakages and achieve savings while delivering subsidies to rural and urban areas.

He noted that the feasibility of the method for diesel subsidies is being assessed, including the difference in diesel usage patterns between Peninsular Malaysia and Sabah and Sarawak.

Biodiesel blending

Meanwhile, Fahmi said the cabinet had agreed to increase the biodiesel blending rate from B10 to B15, beginning with an initial implementation of B12.

He noted that the move will not incur any additional cost for the government, as the move will utilise existing biodiesel blending infrastructure.

He added that the cabinet was informed by Plantation and Commodities Minister Noraini Ahmad that infrastructure capable of supporting B20 biodiesel is readily available across Sarawak, except in Bintulu, with similar facilities also in place in Labuan and Langkawi.

Economy Minister Akmal Nasrullah Nasir is scheduled to visit relevant premises this weekend to inspect raw materials used in biodiesel blending, Fahmi said.

Yesterday, Akmal said the increase in the biodiesel portion of biodiesel blends would avoid over-dependence on imported fuels and reduce exposure to external market forces.

No diesel sent to the Philippines

On a separate matter, Fahmi reiterated that Malaysia did not send diesel to the Philippines amid rising fuel prices, stressing that the fuel in question did not originate from Malaysia.

“Regarding the diesel delivered to the Philippines, the oil is not from Malaysia. This has been confirmed,” he said briefly.

On Monday, Fahmi said the diesel was not processed by Petronas or any local oil company, and is instead owned and sold by a Singapore-based company.

Previously, the NEAC Crisis Management Team said in a statement that 329,000 barrels of diesel recently sent to the Philippines did not originate from Malaysia, contrary to what was reported by several international media outlets.

Petronas, in a separate statement, also denied involvement in the shipment, which consisted of 52.311 million litres of diesel, to the neighbouring country.

Bersatu vice-president Radzi Jidin had earlier urged Putrajaya to issue an official statement clarifying the Philippines’ Energy Department’s (DOE) confirmation that the government has received a shipment of 52.311 million litres of diesel “from Malaysia”.

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