Najib urged to break silence over fuel subsidy

Parti Keadilan Rakyat (PKR) secretary-general Rafizi Ramli urged Prime Minister Datuk Seri Mohammad Najib Tun Razak to break his silence over the fuel subsidy, stressing the increase fuel price is not reciprocal with global crude oil price.

Rafizi, who is also the member of parliament of Pandan, said Najib has to ‘rewrite the script’ and explain on how subsidies cause financial strain to fiscal spending.

He pointed out that analyst have projected the global crude oil price is already sliding downtrend and may drop further between US$70 and US$80 per barrel in 2015.

“If the global crude oil price dropped to US$73 per barrel, then consumers are actually paying the market price, and if it drops further, they (consumers) will be paying more than the market price,” he said, adding that at end result, consumers will be subsidizing the government.

on Tuesday, crude oil price dropped to US$82 per barrel, which is the lowest in the last four years, Rafizi explained.

He said Saudi Arabia, as the world major oil producer, moved to cut oil prices it sold to the US has further dampened the global oil price index.

“The government cannot ignore this prediction. At the price of US$73 per barrel, the government will not bear any subsidy cost,” he told the reporters at the Parliament lobby yesterday.

Rafizi also said subsidy rationalization effort by the government will not be valid as the global crude oil price index is not in favour of what the government has predicted years ago.

“My fear is that if he (Najib) remains silent, he will do away with the subsidy quietly. He has to be reciprocal. You raise pump prices when global price goes up, but then you have to reduce it when it goes down,” he said.

In early October, the government has further cut subsidies on RON 95 and diesel by 20 sen per litre, respectively.

RON 95 now costs RM2.30 a litre, up from RM2.10, while diesel is at RM2.20 from RM2 previously.

“Fuel is the most dominant cost factor in Malaysia,” said Rafizi who will reveal the breakdowns on fuel consumption by low and high income group next Monday.

“I’m running through the numbers now. Will make necessary announcement next Monday once I got my figures in hand,” he said.

TMR

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