Prime Minister Kay Rala Xanana Gusmão presented the budget amendment to parliament on May 28, according to a government statement issued after the opening of debate on the proposal.

Detailed discussions are expected to continue until June 2 before a final vote, with the revised budget expected to be approved or rejected in early June.

A key component of the proposal is a US$174.3 million strategic fuel reserve to be established in Hera, Betano, Oecusse and Ataúro. According to the government's budget proposal, the reserve is intended to strengthen national energy security and ensure essential services can continue during possible fuel supply disruptions.

The amendment also includes US$42 million for fuel subsidies aimed at limiting the impact of rising international fuel prices on households and businesses, according to the government.

“The world is currently facing a period of unpredictability and insecurity,” Gusmão told lawmakers, according to a statement published by the government on May 28, arguing that Timor-Leste must prepare for increasing volatility in international markets.

The proposal follows an extraordinary meeting of the Council of Ministers on May 27, where ministers reviewed implementation of the 2026 State Budget and discussed government spending and project delivery, according to an official press release.

The government said budget execution had reached about US$736 million, or 30% of the annual allocation, by May 26.