Malaysia may review Budget again if oil falls below US$25: Bernama

A customer refuelling his motorcycle at a Petronas station in Kuala Lumpur.
A customer refuelling his motorcycle at a Petronas station in Kuala Lumpur.PHOTO: BLOOMBERG

KUALA LUMPUR (REUTERS) - Malaysia's Second Finance Minister Ahmad Husni Hanadzlah said the government may further revise its 2016 Budget if oil prices fall below US$25 per barrel, state media reported.

Datuk Seri Ahmad Husni said on Radio Television Malaysia (RTM) late on Tuesday (Feb 2) that the government must always be realistic in determining national expenditure, according to state news agency Bernama.

Last week, Prime Minister Najib Razak slashed 2016 spending plans and trimmed its growth forecast in a Budget revision as weak global oil prices squeezed finances of South-east Asia's third-largest economy.

The revised Budget was based on the assumption that world crude oil prices would be US$30-US$35 per barrel.

However, Mr Ahmad Husni said a further decline in the oil price "by US$5 per barrel is impossible as oil producers (countries) will definitely protect their financial position".

Crude oil prices were at US$32 per barrel on Wednesday.

Malaysia, which is the world's second-largest exporter of liquefied natural gas, has been hit hard by tumbling oil prices.