Fewer than 8,000 owners of jeeps and pickups nationwide, representing around 7% of such vehicle owners, fully utilized their 400-litre monthly Budi Diesel entitlement in September, according to Malaysia’s Finance Ministry. The ministry highlighted this as evidence that the current fuel subsidy approach effectively addresses the actual needs of users without requiring a blanket quota exemption.
Budi Diesel, a subsidized diesel fuel scheme priced at RM2.10 per litre for eligible Malaysians verified through MyKad identification, was gradually introduced from June 27 and expanded nationwide starting July 1. In September, the base monthly entitlement was increased from 200 to 300 litres, with an additional 100 litres available for qualifying jeep and pickup owners.
Sarawak, where four-wheel-drive vehicles play a significant role in daily transportation, has approximately 110,000 registered jeep and pickup owners. The ministry noted that around 40% of these vehicle owners may qualify for the extra diesel allocation. It also emphasized that the scheme's design accommodated the state's unique needs without implementing a wholesale exemption.
Since September 16, registered vehicle owners can transfer their fuel entitlement to any individual who uses the vehicle, widening the previous restriction that allowed transfers only within immediate family members. Additionally, owners with multiple private diesel vehicles are allowed to transfer their entitlements to up to three other persons.
The ministry is also considering extending Budi Diesel benefits to boat operators and residents in remote interior regions who rely on diesel for generators and water pumps, pending verification by state governments and relevant agencies.
These details were provided in response to a parliamentary query from Saratok MP Datuk Ali Biju, who asked whether the government would exempt private diesel users in Sarawak from the monthly quota. He based his request on the Malaysia Agreement 1963 (MA63), Sarawak’s status as a major petroleum producer, and its challenging geography.
In a separate parliamentary reply, the Finance Ministry disclosed that subsidies for petrol, diesel, and liquefied petroleum gas (LPG) rose sharply in early 2026, from about RM800 million monthly in January and February to nearly RM5 billion in March and April. This increase followed a surge in crude oil prices above US$120 per barrel due to conflict in the Middle East. Subsidy expenditures later declined to roughly RM3 billion per month between June and August.
The ministry reiterated the government’s expectation to spend RM40 billion on petroleum product subsidies for the year, significantly higher than the RM15 billion allocated in Budget 2026. This projection was previously revealed in July.
Budget 2027 is scheduled to be tabled on the day of the ministry’s recent reply.