KUALA LUMPUR: Diesel sales at petrol stations have decreased by 30 per cent within the first week of the government rationalising the fuel's subsidy on June 10, the Dewan Rakyat heard today.
Finance Minister II Datuk Seri Amir Hamzah Azizan said during the ministerial explanatory session that this was equivalent to a decrease of eight million litres a day compared with the previous week.
He said within the same period, the "commercial" sale of diesel (fuel purchased by companies at the unsubsidised market price) had increased by four million litres.
This indicated that some companies that should have purchased diesel at market prices had previously bought subsidised retail diesel, he said.
"The upward trend in commercial diesel sales is also positive as it indicates a reduction in subsidised diesel leakages," he said.
Amir Hamzah said an oil company had informed the authorities that diesel sales at border petrol stations dropped by 40 per cent.
"This information was obtained from an oil company, which has provided additional evidence of diesel smuggling into neighbouring countries," he said.
Amir Hamzah said the country's diesel subsidy expenditure had increased tenfold, from RM1.4 billion in 2019 to RM14.3 billion in 2023, where it is no longer sustainable for the government in the long term.
"The rise in subsidy expenditure is not solely due to market price increases but also because of increased consumption of subsidised diesel.
"The amount of subsidised diesel used has surged by approximately 80 per cent, from 6.1 billion litres in 2019 to 10.8 billion litres in 2023, despite no significant increase in new diesel vehicles during the same period.
"During this period, the sales volume of unsubsidised commercial diesel had decreased by two billion litres."