Malaysia's government has decided to increase the monthly quota for subsidized RON95 petrol (Budi95) from 200 liters to 300 liters, effective September 1, 2026. This announcement was made by Prime Minister Datuk Seri Anwar Ibrahim during the 2026 National Day celebration in Putrajaya. This increase of 100 liters applies to eligible recipients of the targeted petrol subsidy.
In addition to RON95, the quota for Budi Diesel recipients will also see an increase, moving from 300 liters to 400 liters per month. These adjustments come after the government had previously cut the subsidized RON95 quota from 300 liters to 200 liters in April 2026, citing a surge in global oil prices due to geopolitical conflicts and a need to curb fiscal pressure.
The decision to raise the quotas follows calls from various groups, including the National Consumer Foundation Malaysia (YPNM) Sabah chapter and PKR Youth, who had urged the government to review and restore the previous 300-liter limit for RON95. These groups argued that the subsidy mechanism should be flexible and responsive to the needs of the people, especially as oil prices stabilize and the country's fiscal position potentially improves.
This move by the government is a reversal of its earlier subsidy reforms, which aimed to reduce fiscal spending. In July 2026, Prime Minister Anwar Ibrahim had stated that government spending on petrol and diesel fuel subsidies could approach $40 billion for the year if market prices for oil persisted. Despite previous intentions to continue fuel subsidy reforms, this recent increase suggests a shift in policy, potentially influenced by public sentiment and the approaching general election.
