Beyond the pump

Added: 2026-06-02

[00:00:15]So unlike the crisis in 1979, the crisis that we're facing now is not just an oil crisis. It's also a supply crisis. So in 1979, Petronus was able to cushion the fall uh cushion like the short that we're facing. The actual problem that we're facing right now is that a lot of industry inputs in our economy depend on uh items from the Gulf. So NAFTA for plastics, uh URA for fertilizer and such. So the simple way I put this is that Pattonas can cushion the revenue problem, but it can't cushion the supply problem that we're facing right now.

[00:01:02]Right now households are still going to feel the supply side problem. So they're going to start seeing that their package package food packaging will change. They will also see price increases for certain things. But businesses will face the sharper end of the stick. businesses will start seeing that their fuel for industrial use, their urea for fertilizer is still will still follow market price. So they'll face the bigger brunt of the crisis.

[00:01:27]>> Are we feeling the pinch right now >> right now? Uh yes, a little bit. So we start seeing that Farm Fresh has already changed uh their packaging from bottles to cartons and we start to see that at least in the business side for let's say plantation owners and perhaps even vegetable farmers that their fertilizer prices are a bit higher now and that's going to affect maybe consumers 6 months down the road when they start seeing that after this first planting cycle uh prices might go up for vegetables and even chicken feet.

[00:02:15]the Malaysian government can pay for it.

[00:02:18]But I guess the larger question is that every ring that we spend on subsidies is a ringit that we're not spending on healthcare or education. And I think that's the larger conversation that Malaysians should have about this. It's a sensitive conversation because the ideas being put forward is necessarily about making decisions and trade-offs between parts of society. So a recent proposal is for T20 households to not get booty 95. That's an active choice and that is actually actively a political choice and I think that's a conversation that Malaysians as a society should start having and unfortunately we're not.

[00:02:54]what's the measures that can be implemented effectively immediately to bridge for the shocks currently and for the future.

[00:03:06]>> Since we're in the crisis, there's not really a lot of space to build buffers.

[00:03:11]So, I think the immediate uh structural thing that we should do think of is fage. Identify where critical inputs are and identify where a shortage of these critical inputs would hurt the most households. Try to help businesses replace whatever that's needed. We can start thinking about emergency procurement channels, government procurement channels, use trade diplomacy to try to acquire the things that these these firms might need.

[00:03:47]I think buying local can matter but I will put a caveat that it can matter at the margins rather than as a strategic response to this crisis. Buying local can work uh for a lot of uh for a lot of supply chains that are completely domestic for example in a country. So you might imagine that Kong will have like chicken feed that is grown domestically. You might have uh local fish that are grown domestically. All all the supply chain that go is grown domestically. So that's a great example contentwise. I think when it comes to communication of this crisis, we should be very careful about separating the temporary versus the structural. So oil prices increasing, we've seen it before and that's just a price. This a price event and it's temporary. But like shipping insurance going up as a result of the homeless crisis, that's structural for the foreseeable future because like for example, uh it might take until January 2027 before they revise that. So helping people share expectations when it comes to their businesses and their house when it comes to their items, that's important. And I think Bengara and the government should do a lot uh should do a bit more when it comes to communicating what's temporary and what's structural. Form wise I think it's important that we name the policy choices and why >> especially for the government. When we name the policy choices we also have to communicate the problems behind the policy choices. And I think that's important.