KUALA LUMPUR: There will be a weekly fuel price revision if the government agrees with the idea mooted by the Petrol Dealers Association of Malaysia (PDAM).
Deputy Finance Minister Datuk Johari Abdul Ghani said the government was receptive to the idea, adding that PDAM was expected to submit a proposal to the ministry soon.
The retail fuel prices have been fixed on a managed float system since Dec 1 last year, where retail prices are based on the monthly average world price of crude oil.
Johari said factors pertaining to the float system and the fluctuating global oil prices must be studied before a weekly revision could materialise.
He said one of the advantages of the proposal was the likelihood of moderate changes in retail prices.
“Instead of a monthly review, PDAM is suggesting for a weekly price revision. Western countries, however, have been carrying out daily revisions (to adapt to the fluctuating oil price).
“However, there are factors that must be studied. For example, can petrol stations immediately adopt a new system? Hence, the ministry will look into the proposal.
“We also have to get feedbacks from stakeholders and petrol station operators, and see whether they are agreeable to the proposal,” Johari said at the special monthly, local and weekly lucky draws for Bank Simpanan Nasional’s premium savings certificates at Sri Pentas TV3 in Petaling Jaya yesterday.
PDAM president Datuk Hashim Othman said a weekly revision could mitigate losses and increases in cost among consumers, petrol station operators and other stakeholders.
“This is because an increase in the fuel price can affect the prices of goods. This could affect the monthly expenditure of consumers. If a weekly revision is implemented, consumers will not have to suffer drastic change in their monthly budgets.”
However, Federation of Malaysian Consumers Associations is against the idea.
Its deputy president, Mohd Yusof Abdul Rahman, said a weekly revision would burden consumers’ finances since fuel prices could increase constantly.
“But the same could not be said for the prices of goods, even if retail fuel prices were to drop. This is because the prices of goods are likely to be fixed according to the last increase in fuel price. The weekly revision will benefit only stakeholders or those in the industry, not consumers.”
Meanwhile, Johari said the government would not revise the 2016 Budget despite the decline in oil prices.
“When we prepared the budget, the oil price was US$48 per barrel, but now it has dropped to US$36 per barrel.
“The impact on government revenue is bearable, so we do not see a need to do a revision at the moment.”
He said the government would continue to monitor price movements in the first quarter of next year.
“Even if oil price were to fall below US$30 per barrel, the government will adjust its spending to mitigate the need to revise the budget.”