KUALA LUMPUR — Putrajaya still expects to spend RM3.5 billion a month on fuel subsidies in the short term despite the US-Iran ceasefire agreement, the Finance Ministry said.
While the government views the agreement positively as it has helped to lower global oil prices, the ministry said there are still short term risks that prevent oil prices from returning to pre-conflict levels anytime soon.
“This includes uncertainty over the re-opening of the Strait of Hormuz to commercial shopping, supply disruptions that will take months to be fully restored, as well as the risk that the ceasefire negotiations may collapse,” the ministry said in a statement.
“In this climate, the government expects to bear a fuel subsidy bill of around RM3.5 billion a month. Of that amount, the subsidy for RON95 is projected to cost around RM2 billion a month, while the diesel subsidy is expected to be cost around RM1.5 billion a month.”
The US-Iran ceasefire agreement has been signed electronically and the countries’ leaders are to meet in Geneva this Friday for the formal signing ceremony. The agreement, however, does not mark a permanent truce in the conflict but provides a framework for further negotiations over 60 days to reach a final, lasting settlement.
The ministry also announced fuel prices for the coming week starting tomorrow until June 24.
The unsubsidised prices of RON97 and RON 95 petrol remain unchanged for that period, at RM4.35 per litre and RM3.72 per litre, respectively.
The retail price of diesel in the peninsula, however, dropped 30 sen to RM4.37 per litre for the period.
Subsidised RON95 under the BUDI95 programme remains at RM1.99 per litre, while subsidised diesel in Sabah, Sarawak and Labuan remains at RM2.15 per litre. – June 17, 2026