08/04/2026

WEDNESDAY | APR 8, 2026

2

‘Hormuz stability unlikely to instantly relieve fuel costs’ o Multiple factors

Call for urgent shift in energy strategy PETALING JAYA: Prime Minister Datuk Seri Anwar Ibrahim said the escalating conflict in West Asia is exposing Malaysia to energy supply disruptions and price volatility, and called for an urgent shift in the country’s energy strategy. He said intensifying geopolitical tensions in the Middle East are reverberating across economies far beyond the region, laying bare deep vulnerabilities in global energy systems and challenging assumptions of economic resilience. Speaking at the Kuala Lumpur-Ankara Dialogue 2026, he said Malaysia must confront the reality that it is not insulated from external shocks. “For Malaysia, this means acknowledging that we are not immune to disruptions in global energy supply,” he said, adding that Putrajaya has taken steps to manage exposure to volatility while safeguarding supply and cushioning cost-of-living pressures. However, he emphasised that short-term interventions would not suffice without long-term structural reform. “This is not merely an environmental necessity. It is a strategic imperative,” he said, calling for a transition towards cleaner and more resilient energy systems. His remarks come as concerns grow over supply disruptions linked to tensions in the Gulf. Last week, Deputy Prime Minister Datuk Seri Fadillah Yusof said Malaysia’s petroleum supply remains stable, with sufficient reserves in place, and assured that contingency measures are ready to ensure continuity under any scenario. Also the Energy Transition and Water Transformation minister, Fadillah added that the government stands ready to source fuel from alternative markets should disruptions tied to the West Asia conflict persist. Anwar described the worsening crisis in the Gulf as a “harsh and dismal reality”, marked by civilian casualties, widespread destruction of infrastructure and escalating humanitarian costs. He said the erosion of international norms, coupled with the unchecked use of military force, is undermining global stability. “A rules-based international order cannot be invoked selectively. Its credibility rests on consistent and even-handed application, particularly in moments of crisis.” While condemning violence in Gaza, Lebanon and beyond, Anwar urged restraint, emphasising that diplomacy must remain central despite heightened tensions. “It is incumbent on us to remain cool-headed and steadfast in the pursuit of diplomacy for peace and stability.” He also highlighted the role of middle powers such as Turkiye in de-escalation efforts, pointing to Ankara’s engagement with regional stakeholders, including Saudi Arabia, Pakistan and Egypt, as a model of constructive diplomacy. He added that Malaysia stands in solidarity with such efforts, alongside partners advocating dialogue and consultation. However, he also said diplomacy without sincerity risks becoming meaningless. “The world has seen too many ceasefires that serve merely as interludes between escalations. What is required now is not the management of conflict, but its resolution.” Anwar underscored the need to strengthen international cooperation, adding that sovereignty, resource security, defence self-reliance and interdependence remain critical pillars of national resilience. He called for broader collaboration beyond governments, involving institutions, industries and civil society, to ensure diplomacy delivers tangible outcomes. Framing the crisis as a defining moment for the global order, Anwar urged collective action to avert long-term instability. “Do we act, collectively and with purpose, to avert a crisis whose consequences would be felt across generations? “Or do we allow short-term calculations for quick gains that lead to long-term instability? “Giving peace a chance is not a mere mantra. It must be built patiently.” – By Harith Kamal

transport route for Malaysia – pricing remains dictated by global markets.” Taylor’s University research cluster lead for innovative management practices Prof Dr Poon Wai Ching said the safe passage of Malaysian vessels through the strait is a positive diplomatic development, but has limited impact on global energy prices. She said structural constraints, particularly on the supply side, continue to underpin high crude and refined fuel prices. “While this eases a specific logistical constraint for Malaysia, it does not materially resolve the broader supply disruptions affecting global markets. Attributing price volatility solely to Strait of Hormuz disruptions would be an oversimplification.” She added that refining capacity constraints and uneven distribution of processing facilities continue to amplify shocks in downstream markets, particularly for diesel. She also pointed to damage to production infrastructure in key Gulf states, which has further delayed supply recovery. “Full restoration of output could take months, even if geopolitical tensions ease. Any stabilisation in prices should be seen as relative rather than a return to pre-crisis levels, as multiple risks continue to support a persistent premium in global energy markets. “In this environment, a rapid reversion to earlier price levels is highly unlikely,” she said, adding that future price movements would depend on geopolitical developments, the pace of infrastructure repair and broader supply demand rebalancing. On the domestic front, Poon said prolonged energy price volatility would continue to feed into inflation, particularly through transport, food and logistics costs.

ease its subsidy burden after a period of elevated spending. “Such an approach is common, in which short-term savings are used to rebuild fiscal buffers rather than translating directly into lower pump prices, particularly for controlled fuels.” He also said several factors could continue to keep prices elevated, including tight global inventories, ongoing geopolitical uncertainty and sustained regional demand, particularly from Asia. “Diesel prices are also more sensitive to supply disruptions and have risen faster than crude due to refining and logistics constraints,” he said, adding that even limited disruptions or renewed tensions could contribute to a risk premium in energy markets. Mohamad Idham said retaining part of any savings would support broader fiscal consolidation efforts, adding that subsidy expenditures had surged during periods of high oil prices. Universiti Kuala Lumpur Business School economist Assoc Prof Dr Aimi Zulhazmi Abdul Rashid said securing crude oil supply from Gulf Cooperation Council countries offers short-term assurance, but does little to shield Malaysia from elevated global prices. He said crude prices remain closely tied to developments surrounding the Iran crisis, with any de-escalation unlikely to trigger a sharp correction. “Even if tensions subside, prices are not expected to fall significantly due to the damage already caused by the attacks.” He added that Malaysia would continue to procure crude at prevailing global market rates, despite smoother passage for its vessels through the Strait of Hormuz. “This only secures the oil tanker

contributing to continued elevated prices: Economist

Ű BY QIRANA NABILLA MOHD RASHIDI newsdesk@thesundaily.com

PETALING JAYA: Stabilising traffic through the Strait of Hormuz is unlikely to bring immediate relief to fuel prices, with economists saying deeper structural pressures, from geopolitical risks to tight inventories, would keep crude and diesel costs elevated. Despite improving shipping flows through one of the world’s most critical energy chokepoints, experts say global markets continue to price in risk, limiting any near-term decline in prices. Universiti Teknologi Mara economist Dr Mohamad Idham Md Razak said crude and diesel prices are unlikely to ease significantly even as shipping activity through the strait gradually normalises. “Markets continue to factor in risk premiums, tight inventories and the possibility of further disruptions. “While some easing may occur in the coming weeks if flows continue to stabilise, prices are expected to remain elevated over the next one to three months before gradually moderating later in the year as supply rebuilds and inventories recover.” He added that in Malaysia’s case, any cost savings from improved shipping conditions are unlikely to be fully passed on to consumers, as the government may retain part of the gains to PETALING JAYA: Malaysia has sufficient petroleum supply to withstand global energy volatility in the short term, with no immediate risk of disruption expected at least until June, Prime Minister Datuk Seri Anwar Ibrahim said. The assurance reinforces his earlier position, when last month he said the country’s petroleum product supplies are secure at least until May 2026. However, he said the country’s energy position remains structurally exposed, as Malaysia continues to rely on imports of certain premium-grade petroleum products despite being a major producer. “People think we are purely a producing nation – yes, but we are also a net importer,”he said at the Kuala Lumpur–Ankara Dialogue 2026 event. Anwar said supply stability for the coming months is underpinned by Petroliam Nasional Bhd’s (Petronas) strong ties with oil-producing countries. “There may be some price disruptions, but in terms of supply, for the next few months, we are quite assured.” On liquefied natural gas (LNG), he said Malaysia remains well-positioned due to its robust domestic output and established import arrangements, particularly with Australia, as well as procurement efforts in Canada through Petronas’ overseas operations. He added that Malaysia is seeking to deepen cooperation with Turkiye across key sectors, including LNG and semiconductors, as part of a broader push to strengthen bilateral economic ties. He also said his long-standing relationship with Ű BY HARITH KAMAL newsdesk@thesundaily.com

See also page 13 Petroleum supply sufficient to withstand volatility: PM

Anwar and Institute of Strategic and International Studies Malaysia executive chairman Datuk Prof Dr Mohd Faiz Abdullah seated next to each other at the event at the Grand Hyatt Kuala Lumpur. – BERNAMAPIC

pragmatic and stable regional approach. On broader geopolitical tensions, particularly in the South China Sea, Anwar said concerns are often overstated by external parties. “Yes, we have overlapping claims, but neither we nor China have shown any intention to escalate tensions,” he said, adding that Malaysia maintains strong ties with China across trade, investment and defence. He added that Asean would continue efforts to advance a code of conduct with China to manage disputes in the South China Sea, underscoring the importance of resolving regional issues independently. “Whether in the Indian Ocean or the South China Sea, we must maintain our right and independence to resolve our own problems.”

Turkish President Recep Tayyip Erdogan has helped anchor the growing partnership, with both leaders sharing a sense of urgency in advancing cooperation. Anwar said beyond energy, Malaysia and Turkiye are working towards a comprehensive strategic partnership encompassing government, academic, institutional and people-to-people collaboration. He added that at the regional level, Malaysia continues to prioritise stability and cooperation within Asean, emphasising that existing border issues with neighbouring countries are being managed through dialogue without escalation. He cited ongoing cooperation with Thailand, Brunei and Indonesia, including joint infrastructure and economic initiatives, as evidence of a