Kuala lumpur: The rise in global oil prices not only puts pressure on oil-importing countries but also impacts oil-producing countries such as Malaysia, said Malaysian Investment Development Authority (MIDA) chairman Tengku Datuk Seri Zafrul Abdul Aziz. He stated that although many people assume oil producers like Malaysia would reap large profits with rising oil prices, the situation is more complex in reality.

According to BERNAMA News Agency, Tengku Zafrul outlined three main effects of rising oil prices on Malaysia's economy. First, he explained that the prices of goods may increase. As transportation costs rise, the prices of imported goods arriving in Malaysia can also go up. Additionally, domestically produced goods may be affected because many raw materials and components are sourced from abroad.

The second effect he noted is the possibility of a slowdown in the global economy. Higher oil prices lead to increased business costs, prompting some companies to reduce production and others to postpone investments. As the global economy slows, demand for Malaysian exports can also be affected, he added.

On the third effect, Tengku Zafrul highlighted that the impact of rising oil prices is not the same for every country. He pointed out that about 80 percent of countries worldwide are oil importers, so high oil prices generally put pressure on their economies. For Malaysia, the impact is mixed because while the country earns additional revenue from the oil sector, it simultaneously faces high subsidy costs.