Why crude oil affects Malaysia so much

From the International Energy Agency in the US:

December cut the outlook for 2015 global oil demand growth by 230 000 barrels per day (230 kb/d) to 0.9 million barrels per day (mb/d) on lower expectations for the Former Soviet Union and other oil‐exporting countries.

Crude demand is a commodity unlike any other.

I'll compare it to another commodity well known Malaysian commodity, palm oil.  Palm oil has applications such as food.  It's doubtful that people will stop making fried chicken or oil based foods no matter what the price. Without cooking oil, fried foods aren't possible.  The demand is  long term sticky and technology doesn't change it much.  People can use less oil but it doesn't taste the same.

Crude on the other hand, demand changes a lot due to technology.  Now people are driving hybrid cars, governments are building more public transport (Mass rail transit) and thus the demand for crude now is anemic.  Is it going to change in the future?  undoubtedly, no.  People aren't going to change their newly developed habits for two reasons: it's cheaper to run a hybrid, and a car isn't something that will change hands quickly.

For new public transport projects, it goes without saying governments aren't going to stop with billions invested in their projects for nothing.  They are going to run their lines whether or not oil is at a cheap price.

This is the "new normal" and what oil producing countries have to live with until population growth and vehicle growth overshadow the current demand situation.  This may happen in 5-10 years, but not in the foreseeable future.

With Petronas dividends contributing 40 of the 200 billion ringgit budget, next year's budget revenues will fall heavily.  At an average of  50-60 usd a barrel for next year, I'll be surprised if Petronas contributes more than 20 billion ringgit a year.