Malaysia Edition: How long can Malaysia keep petrol cheap? | Food supply under threat as fertilisers get costly

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Hopefully all of you had a good Hari Raya weekend, with or without extra days off. But for some, the festivities may have been dampened by rising prices tied to the conflict in Iran.

One commodity tells the story well. Fertiliser is used to grow practically all crops, from rice to durians. Therefore, its price increase has hit both Malaysian farmers and food imports.

While Malaysia exports food – including to Singapore – it also imports 60 per cent of its needs. The government has repeatedly assured Malaysians that there are ample supplies for now. But in Putrajaya, top officials are huddled nearly every day to keep on top of the situation.

For now, subsidised petrol remains at RM1.99 per litre for Malaysian drivers, costing the Treasury over RM3 billion (S$970 million) a month. Higher-grade fuel and diesel, however, have soared above RM5.

Just how long can the government keep petrol cheap for local users? There have been hints of a price review as early as May.

But with an election period looming – three states are due for polls by mid-2027, and talk of an early federal ballot has gained steam – such a move could prove fatal for Prime Minister Anwar Ibrahim and his allies.

Amid the PM’s claims of a Zionist conspiracy to “undermine democracy”, inflationary pressures are probably the greater threat to his government.

It is worth remembering that now-jailed Najib Razak became the first Umno leader to lose power on the back of tax hikes blamed for a rising cost of living. In 2022, then-PM Ismail Sabri Yaakob suffered a similar fate after the Ukraine conflict triggered inflation and shortages, including the curtailment of fresh chicken exports to Singapore.

Whether or not you are still in holiday mode, check out our selection of stories this week. If you have feedback for the bureau, do let us know.