Speaking on his Game of Impossible podcast, Idris said that higher crude prices would boost Petronas’s revenue and potentially allow for larger government dividends.

But this was only “one side of the equation”, he said.

He said the bigger problem was Putrajaya’s policy of keeping pump prices low through subsidies, eroding the net benefit of rising oil prices.

“Although we have an increase in revenue, because we are paying a lot of money for the subsidies, (the net effect) is actually negative for Malaysia,” he said.

Yesterday, amid growing debate over how long Putrajaya can sustain current fuel prices, the World Bank urged Malaysia to raise the subsidised RON95 petrol price from RM1.99 to RM2.05 to ease the government’s swelling subsidy bill.

Its lead economist Apurva Sanghi warned that keeping pump rates artificially low risked deepening fiscal pressures, especially with global crude prices holding above US$100 per barrel.

Malaysia’s energy balance has also weakened over time, with total production falling to between 500,000 and 520,000 barrels of oil equivalent per day, while consumption has climbed to about 720,000 barrels daily, he said.

The country still exports large volumes of gas, but also imports heavier crude for its refineries as much of Malaysia’s own crude is light and sweet, he added.

In a US$120-per-barrel scenario, Idris warned that Malaysia’s monthly fuel subsidy bill could soar to RM5 billion to RM6 billion, translating into an annual cost of RM60 billion to RM70 billion.

In comparison, he estimated the extra oil revenue at US$18 billion to US$22 billion, underscoring why Petronas alone would not be able to absorb a prolonged shock while pump prices remained artificially low.

At US$150 a barrel, he said annual subsidies could rise to RM84 billion to RM108 billion, while extra oil revenue would only hit RM28 billion to RM35 billion.

He said that would leave the government with less room to spend on other priorities, including education, public transport, and aid for the poor.