Muhyiddin said Petronas urgently required a long-term strategy to safeguard its sustainability and competitiveness as a state-owned enterprise, especially in the face of global headwinds such as falling oil prices and the accelerating transition to renewable energy.
“The unresolved dispute between Petronas and Petros regarding gas distribution rights in Sarawak not only impacts Petronas’s revenue, but also destabilises the wider oil and gas industry in Malaysia,” he said in a statement.
Muhyiddin, who is also the Bersatu president and Pagoh MP, cited a June 2 report by The Edge, which stated that several oil and gas companies in the country reported declining earnings or losses in the first quarter of 2025.
A key reason cited was the underutilisation of vessels and delays in exploration activities, both stemming from Petronas’s dispute with Petros.
“If this situation persists, it will not only place Petronas and its employees in a state of uncertainty, but also jeopardise the entire oil and gas ecosystem. Currently, over 70,000 Malaysians are employed in the oil and gas services and equipment sector,” he said.
Last week, Petronas president and group CEO Tengku Muhammad Taufik Aziz announced that the company would reduce its headcount by more than 5,000 people to cut costs due to falling crude prices.
Yesterday, Petronas reaffirmed its commitment to safeguarding employee welfare amid a company-wide restructuring exercise that will cut about 10% of its workforce, including by offering competitive separation packages.
On Saturday, deputy prime minister Fadillah Yusof said Petronas’s move to trim its workforce stemmed from global challenges and was not connected to the national oil firm’s issues with Petros.
Muhyiddin urged the government to exercise prudence in its use of Petronas funds, especially at a time when national debt was rising and the economy remained weak.
He said the government should urgently table a sustainability plan for Petronas, along with a clear roadmap for the future of Malaysia’s oil and gas industry.