Subsidised cooking oil is being sold as prayer oil at sky-high prices, with one brand recording a staggering 228% profit margin, according to the Penang Hindu Association.
Its president, Dato’ P. Murugiah said the association had received credible inside information from retail sources revealing that most of the prayer oil used by Hindus and temples is subsidised cooking oil, originally meant to support low-income households under the B40 group.
The government supplies subsidised cooking oil at RM2.50 per kilogram to help ease the burden of essential goods for the poor. However, the association claims that some suppliers are repackaging this oil as prayer oil and selling it for up to RM8.20 per litre.
“(It) is a mind-blowing 228% profit from the actual subsidised price. Some brands of prayer oil cost even more,” Murugiah said in a statement.
He also pointed out that this issue is not new, as two years ago, officials from the Ministry of Domestic Trade and Cost of Living (KPDN) reportedly caught a trader in the act of rebottling subsidised cooking oil and marketing it as prayer oil.
On 10 June 2025, the KPDN branch in Penang busted a syndicate that had been using courier services to transport subsidised cooking oil illegally. Acting on a tip-off, enforcement officers uncovered a repackaging operation at an unlicensed premises, where subsidised 1kg oil packets were emptied into bulk tanks and redistributed as commercial cooking oil.
Nearly 4,000kg of oil was found stored in a cylindrical tank, alongside 128 partially cut 1kg packs. The total seizure, including a lorry and packaging equipment, was valued at RM64,567.50. A lorry driver was arrested, and the case is being investigated under the Control of Supplies Act 1961 and the Anti-Money Laundering Act.
Murugiah added that some suppliers would even resort to using colour dyes for the oils in order to avoid detection, he said.
PHA is calling on KPDN to intensify enforcement efforts and carry out more frequent inspections at retail outlets to identify and act against profiteers.
“The association is also urging the ministry to accelerate the nationwide implementation of the Cooking Oil Price Stabilisation Scheme System (eCOSS), which is designed to manage and trace the flow of subsidised oil from refineries to retailers.”
PHA is also appealing to KPDN officials to intensify their surveillance and conduct regular checks on the source and price of the prayer oils being sold at retail outlets.
Murugiah said that a more robust and transparent system could close current loopholes that enable the diversion of subsidised goods into more lucrative markets.
In addition to enforcement, Murugiah also stressed that the source of the oil and retail price used must be clearly indicated on the label.
“(This is) in line with existing consumer protection regulations. According to the Labelling Act, misleading or incomplete labels are an offence,” he said.
He said the authorities should take immediate action against the prayer oil traders who use subsidised cooking oil at an excessive price.
“PHA would also like to remind consumers to always check the prices and the source of the prayer oil before buying,” the statement added.
In February, the plantation and commodities minister (KPK) Johari Abdul Ghani recommended that the government gradually replace the blanket subsidy system with a targeted subsidy programme using the PADU (Pangkalan Data Utama) platform. The proposed policy shift aims to address leakages in the current subsidy framework.
The PADU system, which compiles household and individual socioeconomic data, would enable direct cash transfers to verified low-income recipients so that only eligible beneficiaries receive assistance while preventing abuse by middlemen and ineligible groups.
The PHA is a non-profit organisation actively engaged in social, educational, cultural and legal support services for the community. It provides food aid, legal aid, financial assistance, and funeral arrangements for the needy, including unclaimed bodies.
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