Cover image via Anwar Ibrahim
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Malaysians may not be lining up at petrol stations just yet, but the early effects of rising global oil costs are already starting to show up elsewhere
Prime Minister Datuk Seri Anwar Ibrahim has warned that the country is already in a "crisis" phase, even if the impact is not immediately visible to the public.
"We must acknowledge that we are already in a crisis. Even though some people might think we are not in trouble because we have not reached the stage of having to queue at petrol stations.
"That is incorrect. There is already a problem because prices are already increasing, like prices for fertilisers," he said while addressing a group of civil servants in Putrajaya yesterday morning, 9 April.
Although "crisis" sounds scary, Anwar highlighted that Malaysia is actually in a position of relative resilience.
While neighbouring countries are already facing fuel rationing or station closures, Malaysia's pumps remain open, but the cost of maintaining that stability is exactly what is driving these behind-the-scenes price hikes before they begin to hit consumers more directly.
Even the prime minister isn't immune to 'feedback' from home.
During his speech, he shared that his own son-in-law had questioned him about the lack of early warnings regarding recent diesel price adjustments.
Anwar used this to drive home his point that the government must be transparent now so that families can plan their budgets before the next wave of 'shocks' hits.
One of the clearest early warning signs, Anwar said, is the cost of fertiliser
During a recent visit to a FELDA settlement in Pengerang, located in Kota Tinggi on Sunday, 5 April, the prime minister noted that while price hikes haven't fully hit yet, the impact is unavoidable due to Malaysia's reliance on imports.
"While the prices of fertilisers have not seen a steep increase yet, they will shoot up because the percentage of our fertiliser imports is high," he said.
"This is what I want you to see. So, do not wait until we are in trouble and be surprised. It is our duty to explain… We have to be wise in managing this problem," he added.
Because fertiliser is closely tied to petroleum-based production, any increase in its cost can eventually feed into higher food prices, from vegetables to other agricultural products.
While Malaysia has managed to secure safe passage for its oil tankers through the Strait of Hormuz, the broader impact of the ongoing conflict is still driving up costs globally
Even then, so far, only one Malaysian-linked vessel has successfully passed through the Strait of Hormuz, while several others remain in the high-risk zone.
Anwar explained that indirect expenses are skyrocketing behind the scenes, with maritime insurance premiums surging by more than 100% and freight charges climbing as ships are forced to reroute
"This means the oil that was supposed to be cheap to process in Pengerang has now seen its costs rise," he added, referring to refining operations in Johor.
In other words, even without supply disruptions, the cost of moving and processing oil has risen, and that increase is already filtering through the system.
Quick summary of rising costs:
- Insurance Premiums: Up by over 100% for vessels in high-risk zones.
- Freight Charges: Rerouting ships has made transporting goods significantly more expensive.
- Processing Costs: Refining oil at local complexes like Pengerang now costs more due to these logistics.
What Malaysians can expect next
For now, the effects remain subtle, but Anwar cautioned that this is a long-term challenge as these increases are likely to spread more widely, affecting food prices, transportation, and other everyday goods linked to petroleum.
Based on discussions with the Emir of Qatar, the prime minister warned that global energy supplies could take three to five years to fully recover from the damage of the conflict, even if the war ends tomorrow.
He urged Malaysians to stay prepared for a gradual rise in daily expenses rather than waiting for a sudden "shock".
