Malaysia’s Ministry of Finance used Friday’s Budget 2027 unveiling to confirm that Petronas will pay the government a dividend of RM32 billion ($7.8 billion) in 2027, a 19 percent increase from the RM27 billion ($6.6 billion) earmarked for 2026. Petroleum-related revenue is expected to hit RM61.2 billion ($15 billion), about 15.1 percent of total federal revenue.
The increase is a war-price windfall. Petronas was initially due to contribute just RM20 billion ($5 billion) in 2026 before oil prices surged after the US-Israeli war on Iran and the closure of the Strait of Hormuz forced an upward revision to RM27 billion. The company reported first-half 2026 revenue up 15 percent year over year on higher domestic production, LNG exports and energy prices, with EBITDA and profit after tax each up about 4 percent. The budget assumes average crude around $85 a barrel in 2027, close to the year-to-date average of $89.
The dividend covers a lot of strain: Malaysia’s annual subsidy bill ballooned on higher energy costs, pushing the 2026 deficit target up from 3.5 to 3.6 percent of GDP. The 2027 plan holds the deficit to 3.3 percent on RM459.8 billion of spending and RM380.8 billion of revenue, up 4.7 percent. Petronas also launched Searah, a new upstream company jointly owned with Italy’s Eni, to tap discoveries in Malaysia, Indonesia and Suriname, and diversified its long-term LNG supply arrangements this year. Watch how much of the dividend is sustainable if prices normalize, since petroleum revenue remains the budget’s largest single moving part.