Geopolitical conflicts threaten to push up global oil prices, increasing pressure on the cost of living and requiring comprehensive preparedness from the government and consumers
KUALA LUMPUR: Uncertainty in global oil prices due to geopolitical conflicts could increase pressure on the cost of living. This requires comprehensive preparedness by the government and greater awareness among consumers, according to the Federation of Malaysian Consumers Associations (FOMCA).
FOMCA chief executive officer T Saravanan said the government must ensure monitoring and intervention mechanisms are implemented effectively. These include transparent communication, supply chain monitoring, and control measures to prevent price manipulation or supply shortages.
“FOMCA advises consumers to remain calm and not be influenced by speculation or unverified information,” he told Bernama. He urged prudent spending by prioritising needs over wants and avoiding panic buying that could disrupt market supply.
He said global oil crises can indirectly affect Malaysian consumers through rising transportation costs and higher goods prices. Although Malaysia has price control mechanisms and subsidies, prolonged global uncertainty could strain the country’s fiscal position.
“From an awareness perspective, Malaysian consumers are generally still less sensitive to how geopolitical conflicts can affect their daily lives,” Saravanan added. He warned of panic buying risks during festive seasons if information is not communicated clearly and accurately.
“If the conflict continues, the direct impact may include rising fuel prices, logistics costs, and eventually higher prices of food and essential goods,” he said. This could place particular pressure on low- and middle-income groups.
Meanwhile, Institute for Inclusive Development and Advancement Malaysia (MINDA-UKM) director Noor Azlan Ghazali said rising global oil prices are expected to have widespread effects. These include impacts on transportation costs, production costs, food prices, inflation, and monetary policy.
He said Malaysia, as an open economy highly dependent on global developments, must carefully assess and be prepared for continued pressure from energy market uncertainty. Although Malaysia is an oil-producing country, it is a price taker, not a price setter, in the global market.
The country’s oil reserves are estimated at around 2.7 billion barrels, expected to last about 12 years. This is far smaller compared to major producers such as Saudi Arabia.
Malaysia’s oil production of about 570,000 barrels per day is still insufficient compared to domestic consumption estimated at 747,000 barrels per day. This makes the country a net oil importer.
In this regard, Noor Azlan suggested the government review fuel pricing mechanisms at the pump. He also recommended continuing to implement more targeted subsidies in line with global oil price developments.
Noor Azlan added that all parties must work together to face the challenges of current geopolitical uncertainties. This includes the government, industry, and the public working together without placing blame.
