MALAYSIA’S targeted fuel subsidy programme, BUDI95, continues to protect the bulk of the population from rising petrol costs, Prime Minister Datuk Seri Anwar Ibrahim told the Dewan Rakyat on Wednesday.
Anwar, who also serves as Finance Minister, said data indicates that 90 per cent of citizens consume less than 200 litres per month under the 300-litre monthly allowance for RON95 petrol.
Average usage currently stands at around 100 litres, with BUDI95 recording up to 3.1 million daily transactions, or roughly 96 million per month, demonstrating smooth and orderly operations.
“BUDI95 is a success story that makes us proud. The 300-litre cap per person is sufficient for ordinary use, and 90 per cent of users do not exceed 200 litres monthly,” he said in response to a parliamentary question from Fong Kui Lun (PH-Bukit Bintang) regarding the scheme’s savings for 2025 and projections for 2026.
Under the scheme, Malaysian citizens aged 16 and above with valid driving licences may purchase RON95 petrol at RM1.99 per litre, compared with RM2.60 per litre without subsidy.
Anwar highlighted that the government deliberately chose a phased, targeted subsidy model rather than following recommendations from the World Bank and other economists to liberalise petrol prices, noting that floating prices could have caused inflation to spike and burdened households across income levels.
“This approach has successfully shielded 85 per cent of Malaysians, generating savings of RM6 billion on petrol and RM5 billion on diesel,” he said.
“Few countries dare to implement targeted subsidies given the risks and the challenge of public acceptance. Alhamdulillah, the programme has been successfully implemented and well received.”
The Prime Minister emphasised that targeted subsidies allow the government to limit fiscal leakage from untargeted support while ensuring ordinary Malaysians continue to benefit from affordable fuel.
“Had prices been fully liberalised, only households earning above RM13,000 a month would have been left without assistance, with support provided to all others,” he added.
Anwar described the policy as a demonstration of balance between fiscal prudence and social responsibility, ensuring that savings from the subsidy scheme are effectively redirected to support Malaysians while maintaining access to essential energy resources. - February 11, 2026
