Sabah faces revenue hit as oil prices slump, says Masidi

 

KOTA KINABALU: Sabah will need to revisit its financial planning amid a significant drop in global oil prices, which is expected to cut deeply into the state’s revenue, said Datuk Seri Masidi Manjun.

The state Finance Minister said Sabah's dependence on oil and gas earnings means any price fluctuation on the global market will have immediate consequences.

"I’ve asked my officers to do the calculations, but I can already say the impact will be major. That means we’ll need to reassess our financial planning," he said at the state-level Hari Raya Aidilfitri open house on Saturday (April 5).

"What we envisaged last year may no longer be achievable this year due to the loss in revenue following the drop in oil prices."

With more than half of Sabah's income derived from the oil and gas sector, the slump in prices poses a considerable challenge to the state’s budget and fiscal projections.

Masidi also expressed his concern about the global oil market, noting that ongoing volatility could further strain Malaysia’s finances.

Malaysia will be subject to a 24% reciprocal tariff from the United States starting April 9, following an executive order signed by President Donald Trump.

Beyond fiscal concerns, Masidi also touched on safety issues in the energy sector, following a recent gas pipeline fire in Putra Heights, Selangor.

He called for a reassessment of safety protocols in the gas supply industry to prevent similar incidents from happening in Sabah.

"We use a lot of gas, especially for industrial purposes. As we build our manufacturing industries, gas consumption will certainly increase. This is something we must reflect on to ensure safety measures are in place,” Masidi added. - Star