Delay Ron95 Subsidy Rationalisation Says Petrol Dealers Group

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The Petroleum Dealers Association says outdated margins and rising card fees will cripple small operators if subsidy reforms proceed without adjustments.Finance minister II Amir Hamzah Azizan recently announced that the RON95 subsidy rationalisation would begin in the second half of the year.PETALING JAYA: The Petroleum Dealers Association of Malaysia (PDAM) has called on the government to delay rationalising RON95 subsidies until critical issues affecting station sustainability are addressed
PDAM president Khairul Annuar Abdul Aziz, whose association represents more than 4,000 petrol stations nationwide, said dealer margins, fixed under the automatic pricing mechanism, had not been revised since 2019 and no longer reflected current operating costs.
He also voiced concern over the merchant discount rate (MDR) imposed on card payments, which increases as fuel prices rise but leaves dealers’ per-litre commissions untouched.
“Without a margin revision, small and medium-volume station operators will face losses from the very first day of the RON95 subsidy rationalisation implementation,” he said in a statement today.
“And as pump prices increase under the rationalisation, the MDR rises accordingly, but dealer commissions remain static, resulting in a further erosion of margins.”
Finance minister II Amir Hamzah Azizan recently announced that the subsidy rationalisation would begin in the second half of the year.
Prime Minister Anwar Ibrahim said the cuts would mainly target foreigners and Malaysia’s top 5% to 10% of income earners.
Khairul also took aim at a group representing Bumiputera fuel retailers, which claimed there had been no consultation with dealers on the rationalisation plan.
He dismissed the claim as “inaccurate and misleading”, saying PDAM was the government-recognised umbrella body for petrol dealers and had been in formal talks with the domestic trade and finance ministries.
“We urge all stakeholders to put aside differences and unite behind a common objective: to support a fair and sustainable targeted subsidy system without neglecting the economic realities faced at the operational level,” he said. - FMT

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