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Friday, March 27th, 2026 at News
by SHAUQI WAHAB ( Mohd Shauqi Mohamad Abdul Wahab )
DIESEL prices are expected to remain volatile in the near term, driven by global crude oil fluctuations, exchange rates and geopolitical tensions. QHSEL Consultancy Sdn. Bhd. Principal Consultant and Executive Director Nik Zafri bin Abdul Majid said Malaysia’s current pricing mechanism, shaped by subsidy rationalisation and the targeted diesel subsidy programme, has improved fiscal sustainability, even as market-linked pricing exposes consumers and businesses to global volatility. “Price stability ultimately depends on global crude oil prices, exchange rates, and geopolitical risks. “Stabilisation typically occurs only when global supply conditions normalise which do not look good for now,” he said to The Malaysian Reserve (TMR).
Nik Zafri (picture) said while an extreme oil price spike to US$200 per barrel remains unlikely, such a scenario would present mixed outcomes for Malaysia, benefiting export revenues but increasing inflationary pressures and subsidy burdens.
He also highlighted that sustained high diesel prices could reshape consumer and business behaviour, particularly within logistics and commercial fleets, while gradually strengthening the case for electric vehicles (EV) over time. “Higher fuel prices generally improve the economic case for EVs. However, EV adoption in Malaysia still depends on charging infrastructure, affordability and consumer confidence,” he added. Nik Zafri said any meaningful shift towards EVs would likely be gradual rather than immediate.
Meanwhile, Universiti Kuala Lumpur (UniKL) Business School Associate Professor Dr Aimi Zulhazmi Abdul Rashid (picture) viewed that rising diesel prices, shaped by current market forces and geopolitical tensions, are expected to push inflation higher while increasing the overall cost of living.
He pointed to projections by Fitch Ratings, which estimate oil prices could reach US$128 per barrel in the second quarter of 2026 and average around US$100 for the year, contributing to both domestic and global inflationary pressures.
“The current diesel price is the reflection of the market forces at present. Whether it will reach US$200 per barrel is anyone’s guess,” he said.
Aimi Zulhazmi said global inflation is projected to rise to 4.0% in 2026 amid ongoing geopolitical disruptions.
He added that higher fuel costs are already cascading through the economy, with increased transportation and logistics expenses translating into higher prices for goods, food, and housing, while industries from aviation to construction begin adjusting their pricing structures.
“The domino effect of the diesel prices is certainly profound,” he pointed out.
He said some diesel vehicle owners are considering selling their vehicles or reducing usage, while others are exploring a shift to EVs or plug-in hybrids, particularly in urban areas.
Therefore, he viewed that stronger policy support, including incentives and expanded charging infrastructure, will be crucial to accelerate EV adoption and ease the burden on consumers.
Diesel hike forces 4X4 community to scale back activities
The rise in diesel prices is placing significant pressure on 4×4 communities, with higher operating costs forcing groups to reassess the frequency, distance and scale of recreational, training and humanitarian activities
The situation subsequently dampened sentiment among enthusiasts, with many anticipating reduced participation and ownership as the overall cost of living rises.
4×4 instructor Suhaimy Mohamed Sunar (picture) shared that the increase is also expected to dampen new ownership and participation, while potentially limiting outreach efforts to vulnerable communities such as flood victims and Orang Asli settlements.
“The increase in diesel prices has had a direct impact on the operating costs of 4×4 groups. In some cases, the frequency of activities and travel distances have had to be adjusted to ensure the sustainability of operations,” he shared with TMR.
Despite these challenges, the community remains committed to its social and humanitarian roles, adapting through cost-saving measures such as optimising logistics, focusing on local programmes, and seeking greater sponsorship support.
Meanwhile, 4×4 event organiser and Explorer Outfitter owner Thomas Foo described the impact as severe.
“We are in a state of shock as never ever before this has happened. It is just a very bad sentiment and very depressing, so we will cut down anything to do with corporate social responsibility (CSR), relief or travel,” he said.
He added that higher fuel costs will inevitably reduce outreach efforts while also discouraging interest in 4×4 training and activities.
Looking ahead, the 4X4 community expects that sponsorship support will become increasingly important to sustain activities, as operators and participants struggle to absorb higher diesel costs.
“Petrol prices can increase a bit to help cushion diesel prices as logistics is the lifeline of everything for the economy. The chain effect will impact all Malaysians,” he warned.
As for #Malaysians4Wheelers founder Amir Hamzah (picture), while activities will not stop entirely, groups are likely to reduce travel distances and scale down operations, particularly for charity missions that depend heavily on sponsorship support. “We are not going to stop the activities, but probably we might shorten or minimise the distance. This is one of the steps that we take on how to save the expenses,” he told TMR. He also opined that prolonged cost pressures could lead some owners to sell their vehicles, while others driven by passion will continue, although related costs such as training and spare parts are also expected to rise. The retail price of diesel in Peninsular Malaysia rose by 80sen to RM5.52 per litre, while prices in Sabah, Sarawak and Labuan remained unchanged at RM2.15 per litre from March 26 to April 1.
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