The leakage of subsidised diesel, which is significantly cheaper than the pump price in neighbouring countries, has been a major concern. This issue prompted the Malaysian government to implement a targeted diesel subsidy program starting in June. While pump prices have increased, subsidised diesel remains available, specifically reserved for logistics and certain groups, such as fishermen.
Currently, the subsidised diesel price for fishermen is maintained at RM1.65 per litre. This low price creates a lucrative opportunity for smugglers, making it a valuable commodity on the black market. The Malaysian Anti-Corruption Commission (MACC) recently uncovered a syndicate involved in the embezzlement and misappropriation of subsidised diesel. As a result, MACC arrested five individuals and seized 1.6 million litres of diesel, along with RM3.7 million in cash.
The diesel, which belonged to a fishermen’s association, was being smuggled out by the syndicate. The group is also suspected of bribing enforcement officers in Sibu, Sarawak, to avoid detection and prosecution. According to a report by Bernama, MACC Chief Commissioner Tan Sri Azam Baki issued a statement revealing the arrests and the operation details. The individuals arrested include three men and two women, aged between 30 and 60 years old. They were detained at the MACC branch office in Sibu following a raid on an oil storage depot in Sungai Bidut, conducted in collaboration with the Ministry of Domestic Trade and Cost of Living (KPDN).
“The detainees include four petrol station operators, believed to be the masterminds behind the diesel smuggling activities, and an intermediary suspected of facilitating transactions with external buyers,” said Azam.
During the operation, the MACC confiscated approximately RM3.7 million in cash, two barges, and 30 tanks capable of holding around 1.6 million litres of diesel at the depot. The seized diesel will be handed over to the KPDN for resale to licensed dealers.
The suspects are expected to be brought before the Sibu Magistrates Court for a remand application. The case is being investigated under Section 16(b)(B) and Section 18 of the MACC Act 2009, as well as Section 471 of the Penal Code and the Control of Supplies Act 1961.
Azam added that investigations and intelligence gathered by MACC suggest that the syndicate has been operating since 2012. The group is believed to have profited up to RM400 million by selling subsidised diesel, intended for fishermen, to external parties. The diesel was transferred from storage tanks to barges moored at the depot and then, under the cover of night, transferred to ships owned by foreign buyers.