Malaysia’s upstream oil and gas sector displayed signs of stabilisation in the second quarter of 2025, with crude oil and condensate production reaching 45.2 million barrels, while natural gas output totaled 640.9 billion cubic feet.
Although overall production remained in contraction, the slower decline compared with the first quarter suggests the sector may be entering a recovery phase. Crude oil output fell 2.2% year-on-year, improving from a 6.5% drop in Q1, while condensate production contracted by 1.2%, compared with 2.4% previously. However, natural gas production declined further, down 8.0% year-on-year, compared with a 2.2% contraction in Q1.
Prices and Benchmarks
The Weighted Average Lifting Price (WALP) for crude oil and condensate fell to USD70.4 per barrel in Q2, down from USD76.4 in the previous quarter, reflecting weaker global benchmarks. WTI crude averaged USD64.6 per barrel (Q1: USD71.8), while Brent crude stood at USD68.0 (Q1: USD75.8).
Trade Performance
Malaysia’s crude petroleum and condensate exports were valued at RM6.3 billion during the quarter. Australia was the largest importer, accounting for RM1.9 billion (29.7%), followed by Thailand (26.8%) and Japan (14.6%). Exports of refined petroleum products declined to RM22.7 billion from RM24.3 billion in Q1, with Indonesia leading imports at RM5.0 billion (21.9%), followed by Singapore (20.0%) and Australia (17.2%). Liquefied natural gas (LNG) exports also fell to RM10.4 billion from RM15.5 billion, with Japan receiving 35.3%, South Korea 24.5%, and China 23.4%.
Imports moderated as well. Crude petroleum and condensate imports totaled RM12.9 billion (Q1: RM13.6 billion), mainly from Saudi Arabia (38.5%), the UAE (20.0%), and Sudan (7.2%). Refined petroleum imports declined slightly to RM22.0 billion, with Singapore as the top supplier at 38.0%, followed by China (13.5%) and South Korea (13.2%). LNG imports decreased to RM1.5 billion from RM1.9 billion, with 82.4% sourced from Australia and the remainder from Trinidad and Tobago.
Outlook
Despite ongoing challenges, analysts note that the moderation in production declines, combined with relatively stable crude prices, points to improving conditions in Malaysia’s upstream oil and gas sector. The data suggests that the industry may be gradually recovering from the pressures of the previous quarters.
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