Low oil price squeeze Petronas earning, fiscal implication on Malaysia

Downward pressure to persist

By KIRENNESH NAIR

COMMODITIES

The Star, Wednesday, 02 Jul 2025

PETALING JAYA: Crude oil prices are expected to remain under pressure in the second half of 2025 (2H25), as increased production from the Organisation of Petroleum Exporting Countries and its allies (Opec+), coupled with fragile global demand, weigh on the market.

This scenario could affect Malaysia’s oil and gas (O&G) revenue, company valuations and capital expenditure (capex).

Brent crude, which briefly spiked to US$81 per barrel after the United States bombed Iran’s nuclear facilities on June 22, has since fallen to US$68 as oversupply concerns resurface.

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Petronas at fault, CEO should resign!

The judgement is out. Soil instability led to structural failure and consequently the gas pipeline exploded into an inferno at Putra Heights on the second day of Hari Raya.  

No amount of public relation and corporate communication gymnastics from Petronas media consultant, Accenture can relieve Petronas from being liable. The attitude of Petronas CEO in his limited and dry statements during the crisis confirmed it as admittance of guilt.

The long and short story is Petronas failed to monitor the structural integrity of the site. One can split hair in an attempt to raise doubts by asking the four W and one H questions and redirect responsibility to others such contractors, local authorities, monitoring system, etc. 

The duty of care lies with Petronas and no court could absolve them the responsibility for the damages it had caused to the residences. Too many legal precedents points back to Petronas. One should not be blinded by patriotism and be in a state of denial. Wrong is wrong. 

Corporate man and ex-Petronas Gas engineer, Tan Sri Syed Zainal Abidin Syed Mohamed Tahir convinced the public that the maintainance of the pipeline adhere to high standards and it could last for 50 years. The assurance is short-lived.

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Is the expanded SST much ado about nothing?

"Much ado about nothing" is a Shakespearean play about courtship and scandals. Much ado is seldom used when someone is overreacting and makes a big fuss over something unimportant. 

Introduction of new taxes will not be taken well by anyone, so there is something to ado over the government announced expended Sales and Service Tax (SST) to take effect soon.

It will have an impact on the mid- to high-income households, and businesses in the construction, healthcare, beauty, and education sectors. 

There were much ado over Anwar's mistake to mention GST as broad based General Services Tax. 

But the bigger ado was the nitpicking over taxing import dependent supply of fruits, in which apples and orange (but not pears) have been taken off the list. 

Supposedly the expended SST is targeted on imported goods, and goods and services for the higher income bracket, primarily T20s. 

It will be translated into the cost of living in all aspect of Malaysian life.

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Iran vs Israel-USA: How will it affect us?

Opinion: When giants clash — How the Iran-Israel war could reshape Southeast Asia’s strategic calculus

By Abbi Kanthasamy

Edge Online, 13 Jun 2025, 09:08 pm

On the night of June 12, 2025, the Middle East caught fire again. Israeli warplanes tore through Iranian skies, targeting nuclear facilities, missile sites and the upper echelons of Iran’s military command. Tehran seethed, vowing retribution. Washington — a different Washington under a very different president — publicly distanced itself, while nervously repositioning its naval assets. 

And across Southeast Asia, policymakers and markets alike held their breath.

At first glance, a spiralling conflict between Iran and Israel might feel far removed from Kuala Lumpur’s trading floors, Jakarta’s security briefings, or Singapore’s port terminals. But distance is no insulation in a hyperconnected world. 

This war is not just about uranium enrichment and missile strikes — it is a test of global fault lines, energy choke points, great power rivalry, and economic resilience. And Southeast Asia, caught in the crosswinds of all of it, needs to brace itself.

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SRC DNAA: Time for the Attorney General to Act and Deliver Reform

✍️ By: Dzulkifli Ahmad

Former Chief Commissioner of MACC / Former Deputy Public Prosecutor

The High Court’s decision to grant a Discharge Not Amounting to Acquittal (DNAA) to Datuk Seri Najib Razak in the SRC International money laundering case has reignited critical concerns about the integrity, professionalism, and accountability of prosecutorial decisions in Malaysia.

The charges, filed in 2019 under then Attorney General Tan Sri Tommy Thomas, involved RM27 million under the Anti-Money Laundering Act (AMLA). Now in 2025, the prosecution has admitted that it is still not ready to proceed. 

This is not more than delay — it reflects a failure of prosecutorial governance that must be addressed urgently.

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Be'kelalan apple, Tenom avocado, and Gopeng grapes

There is a thriving debate on social media on the expanded SST to be introduced on July 1st. Prime Minister Anwar Ibrahim mistakenly mentioned GST as General Services Tax and that reignited the pre-GE14 political debate over GST. 

The more superior GST was demonised by PH (to include PPBM in 2018), and PAS that Anwar dare not return to it. More so, the system does not allow for any loophole for "businessmen" aligned to PH to evade tax. Anwar cannot postphone and has to take the bull by the horn. 

He cannot expect any shimmering light of hope to balance the budget without worsening the debt situation built over 28 continuous years of deficit spending. The expanded SST still take into account the B40s and M40s to focus on imported and luxury goods.

Unfortunately the common apple, oranges, avocado and grapes consumed by Malaysians are imported and will be taxed. Mydin called on government to exempt imported apple, orange and pears. 

However, a letter to the editor agree and believe its time to encourage production of local fruits. Why not switch to apple from Be'kelaalan, wide choices of local variety citrus, avocado from Tenom and grapes from Gopeng? 

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IKHLAS advocacy: Early Sokaiya, Yakuza-style racketeering?

In  the 1986 book, Yakuza by David E. Kaplan and Alec Dubro, the company responsible for the widely documented mercury poisoning at the city of Minamata, Kumamoto Prefecture, Japan discovered in 1956 hired goons to intentionally disrupt the Company's AGM. It was to stop environmental activists and public from raising issues and permanently documented in the Company's minutes. 

The usual modus operandi by Japanese corporate racketeer or sōkaiya (総会屋) is to extort money from companies to prevent the 'meeting-men' (or 'corporate blackmailer') from disrupting AGM. And big named and globally renowned corporation paid protection monies to avoid any embarassment arising.  

Such activities declined following laws making it illegal to pay sokaiya, and imposition of jail and heavy fines for offenders from 1982 to 1994. It has not completely ended, but took a less threatening form. 

According to Terence Fernandez of Scoop.com, such activities are alive and kicking in Indonesia. 

Similar extortion have gone largely unreported in Malaysia. And the public may not be aware that the public grievances and usually unsubstantiated accusations aired by certain NGOs are budding Japanese sokaiya. 

Aman Palestine that was raided by MACC for embezzlement of about RM40 million is one subtle example and getting their pay-off from the public. 

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