24/06/2025

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TUESDAY | JUNE 24, 2025

CAAM to absorb Mavcom and become statutory body o With effect from Aug 1, Civil Aviation Authority of Malaysia will be sole regulator for the industry, encompassing, technical, safety and economic aspects Ű BY JOHN GILBERT sunbiz@thesundaily.com

‘Crude oil may climb to US$85 per barrel on geopolitical risks’ KUALA LUMPUR: Crude oil prices are expected to rise towards US$85 (RM364) per barrel in the near term, driven by supply-side risks stemming from recent geopolitical developments, according to CIMB Securities Sdn Bhd. It stated that volatility is likely to remain elevated, adding that a disruption of 500,000 barrels per day in global supply could historically lead to a price surge of around US$10 per barrel. “International sanctions imposed on Iran in 2011-2012 led to a supply loss of 1.4 million barrels per day, resulting in a US$30 per barrel increase in crude prices during that period. “That said, the current global oil market is better cushioned by available spare capacity,” it said. CIMB Securities noted that the Organization of the Petroleum Exporting Countries-plus (Opec+) currently holds an estimated 5.7 million barrels per day of excess capacity. However, it assessed that a key vulnerability lies in the fact that the bulk of the oil supply is exported via the Strait of Hormuz. “In our view, should the proposed closure of the Strait of Hormuz materialise, the risk premium could surge, potentially pushing Brent prices above US$100 per barrel,” it said. The Strait of Hormuz facilitates the transit of approximately 20% of global oil consumption, underscoring its strategic importance. Meanwhile, Public Investment Bank Bhd (PIVB) said the uncertainty in the Middle East is likely to cause a spike in oil prices as the region contributes 30% of the world’s total output, with Iran being the third-largest Opec producer. It said that if there is no material disruption to the global oil supply with the Strait of Hormuz remaining accessible, this may well be short-lived, as there is still ample supply of oil in the market, while global demand could weaken due to a slowdown in international trade following the increase in tariffs. “Nonetheless, given the uncertainty and risk of escalation, oil prices are likely to surge in the immediate term, while investors would rush to safe-haven assets and avoid risky investments such as equities,” it said. – Bernama

PUTRAJAYA: The Civil Aviation Authority of Malaysia (CAAM) will transition into an independent statutory body effective Aug 1, with separate remuneration and exemption from the government. Transport Minister Anthony Loke Siew Fook said the government has strengthened the regulatory structure and development of the national aviation industry by transitioning CAAM into a Statutory Body with Separated and Exempted Remuneration (BBDSB), and by rationalising CAAM and the Malaysian Aviation Commission (Mavcom). He said this change will save the government between RM150 million and RM200 million annually and between RM1.5 billion and RM2 billion over the next 10 years. With this rationalisation, CAAM will take over the economic regulatory functions previously carried out by Mavcom, making CAAM the sole regulatory body for the aviation industry, encompassing technical, safety and economic aspects. Loke noted that this decision by the government will grant CAAM autonomy and flexibility in financial governance, human resource management and the ability to make strategic decisions. Additionally, CAAM will have the capacity to plan and implement more efficient resource management strategies in line with international best practices. “The estimated revenue for CAAM this year is RM420 million. Previously, our annual revenue was only in the region of RM100 million to RM110 million. “Given these figures, it is clear that CAAM could not survive on its own. That is why, until now, it has required an annual injection of at least RM150 million to RM200 million from the government to keep its operations running – and that is before accounting for the maintenance of our air traffic control towers, SEPANG: AirAsia X (AAX) yesterday announced a new route to Tashkent, Uzbekistan, commencing on Oct 15 with a frequency of three times a week. Following AAX’s entry into the region with Almaty, Kazakhstan in early 2024, with a consistently strong load factor and increased flight frequencies, the Tashkent route is aimed at further facilitating air travel between Southeast Asia and Central Asia, fostering stronger trade, tourism and business ties between the regions. This connectivity will enable more travellers in Asean as well as Australia, to explore Uzbekistan affordability with AirAsia’s Fly-Thru options, spanning over 130 destinations worldwide. AirAsia X CEO Benyamin Ismail said: “The launch of our Kuala Lumpur-Tashkent route is a strategic milestone in AAX’s continued growth across Asia and beyond. Central Asia presents immense potential, with Uzbekistan’s economy growing steadily and a rising middle class eager to explore new destinations. “We have seen a marked increase in passenger demand for Central Asia following

CAAM will achieve financial independence and gain the capacity to offer more com petitive remuneration, particularly for our technical personnel. This is a critical step forward, as our inability to compensate our qualified technical staff at market rates was a key factor in CAAM’s previous downgrade from Category 1 to Category 2 by the US Federal Aviation Administration,” Loke said. The audit findings at that time made it clear that competitive salaries are essential for talent retention, he disclosed. “Now, with improved financial standing, we are in a much stronger position to attract and retain top-tier technical talent. Our objective is not only to secure the best-qualified technical personnel but also to invest in the development of our air traffic controllers, enhancing their skills and operational efficiency. “This approach aligns with our commit ment to building a robust and sustainable workforce for the future of Malaysia’s aviation industry,” the minister said. Loke assured all Mavcom employees that they will have the opportunity to transition into roles within CAAM following the merger. He emphasised that the restructuring process will be managed systematically and with complete transparency, in line with established governance principles. Additionally, a business continuity plan has been developed and will be shared with impacted staff through dedicated internal briefings. Currently, Mavcom employs 57 personnel, all of whom will be considered for positions at CAAM as part of the merger process.

other facilities, or any development projects. “Now, our estimated revenue for this year stands at RM400 million. We have already collected about RM150 million in just the first five months, exceeding the total revenue for the entire previous year. “This strong performance has given us the confidence that CAAM will become financially independent and sustainable. This financial sustainability is also one of the critical conditions set by the Cabinet and the Public Service Department for granting CAAM its status as a BBDSD,” he told reporters in a briefing yesterday. Loke said this initiative is part of the government’s current reform agenda and policy direction to improve service delivery efficiency and to centralise government institutions with overlapping roles. Through this rationalisation, it establishes a solid foundation for CAAM to drive the growth of the aviation industry towards a progressive and sustainable future, suppor ting Malaysia’s goal to become a regional aviation hub. This capability is also crucial for CAAM’s efforts to retain and attract highly skilled talent in technical fields, especially qualified technical personnel who are critical in ensuring the safety and security of the national aviation industry. Loke said this sector requires a workforce that is not only qualified but also highly skilled and experienced, in compliance with the requirements of the International Civil Aviation Organization. “With this significant increase in revenue, Meanwhile, Uzbekistan ambassador to Malaysia Karomidin Gadoev commented: “The commencement of direct flights by AAX between these two major cities is a landmark development for Uzbekistan-Malaysia relations. With Uzbekistan’s tourism sector expanding rapidly and Malaysia’s strong position as a tourism and business hub in Southeast Asia, this route will significantly enhance connectivity, foster tourism exchanges, and open new avenues for investment. We are excited to welcome AAX to this promising market and look forward to a fruitful venture.” To mark AAX’s commencement of the Tashkent service, travellers will get a promotional introductory fare from RM99 all-in one-way economy seats starting from yesterday until June 29 for the travel period between Oct 15, 2025 and Sept 14, 2026. This special fare is subject to availability, with subsequent fares starting from RM899. our successful Almaty route, and our vision is to create a comprehensive network that supports regional development and connects people to new places whilst creating unforgettable travel experiences along the way.”

AirAsia X expands Central Asia reach with new route to Tashkent, Uzbekistan

From second left: Tourism Malaysia director of international promotions for America, Europe and Oceania Mohd Akbal Setia, AirAsia Aviation Group chief commercial officer Amanda Woo, Ministry of Tourism, Arts and Culture deputy secretary-general (tourism) Chua Choon Hwa, Benyamin, Gadoev, AirAsia X chairman Datuk Fam Lee Ee and Ikhlas.com CEO Ikhlas Kamarudin.