Malaysia must pursue a diversified and carefully managed energy transition that balances energy security, affordability and sustainability while strengthening the country’s long-term competitiveness, Economy Minister Akmal Nasrullah Mohd Nasir said.
Speaking at Oil and Gas Asia 2026, Akmal Nasrullah said oil and gas (O&G) will continue to play an important role in Malaysia’s economy and energy security, with natural gas expected to remain a major component of the primary energy mix through 2050 as renewables are scaled up.
However, he cautioned that excessive dependence on any single energy source would leave the country vulnerable to external shocks.
Malaysia’s policy direction under the 13th Malaysia Plan, National Energy Policy and National Energy Transition Roadmap therefore calls for greater diversification into renewable energy, nuclear power, energy storage, hydrogen and bioenergy.
“The objective is not simply to replace one energy source with another,” Akmal Nasrullah said, stressing that diversification should give Malaysia more options, reduce exposure to disruptions and create new sources of economic value.
Malaysia’s current primary energy supply remains dominated by natural gas at 42%, followed by crude oil and petroleum products at 33%, coal and coke at 22%, and hydropower and renewables at 4%.
Akmal Nasrullah said stronger regional energy links will also be critical, pointing to the ASEAN Power Grid as a means of facilitating cross-border electricity trade, supporting renewable integration and improving regional resilience.
He added that Malaysia will require a stronger electricity grid, greater energy storage and deeper integration between energy, industrial and digital infrastructure, with private capital expected to play a larger role in financing the transition.
For Malaysia’s O&G services and equipment industry, the transition also presents an opportunity to move up the value chain, with companies urged to expand beyond traditional services into technology, integrated solutions and international markets.
