Malaysia’s Petronas reduces dividends to the government by 38% in 2026

Petronas, Malaysia’s state-owned oil and gas company, has decided to cut its dividend to the government by 38% in 2026 due to lower oil prices, according to Malaysia’s Ministry of Finance.

The company is expected to contribute RM20 billion next year, down from RM32 billion this year.

This is said to be the lowest payout for the state-owned company since 2017.

According to Finance Ministry reports, released alongside Malaysia’s 2026 budget plan, Brent crude oil prices are expected to average between $60 and $65 per barrel in 2026.

This represents a decline from current estimates of $70 per barrel.

Malaysia is working to reduce its dependence on oil revenues, which accounted for more than 40% of its income in 2009. Its oil-related revenues are expected to fall to RM43 billion, accounting for 12.5% ​​of total revenues, it was reported. Bloomberg.

The government is also focusing on improving tax collection and cutting subsidies to reduce the budget deficit to 3.5% of GDP by 2026 from 3.8% this year.

In the fiscal outlook report accompanying the Budget, the government cited a 9.9% decline in non-tax revenue to RM72.7 billion, primarily due to lower dividends from Petronas.

In addition, non-oil revenues are expected to rise by 8.1% to RM300.1 billion.

The natural gas sector is expected to face a decline due to lower production in Peninsular Malaysia and Sabah, as well as lower demand from major importers such as Japan, China and South Korea. Reuters.

In August, the company announced a strategic shift to address operational challenges, after after-tax profit fell 19% to RM26.2 billion in the first half of the year.

Last month, Petronas, through its subsidiary Petronas LNG, Finalizing an agreement With Woodside Energy Trading Singapore to purchase 1 million tons per year of LNG.

“Malaysia’s Petronas to Cut Government Dividend by 38% in 2026” was originally created and published by Marine technologywhich is a trademark of GlobalData.

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