The estimate is based on an average oil price of RM203 per barrel
By DASHVEENJIT KAUR / Pic By ISMAIL CHE RUS
The impact of rising global energy prices on Malaysia’s revenue will only be known a year after Budget 2018, said Second Finance Minister Datuk Seri Johari Abdul Ghani (picture).
“During the Budget 2018 presentation, the government estimated 2018’s petroleum revenue to average RM37.8 billion, including petroleum income tax, royalties and ancillary income from Petroliam Nasional Bhd (Petronas).
“The estimate was based on an average oil price of US$52 (RM203.01) per barrel. For the period of Jan 1 to Feb 23, 2018, global average oil price was US$67.15 per barrel,” he said at the Dewan Rakyat yesterday.
The current oil price volatility will not be able to reflect an accurate expectations on the additional revenue towards the country, he said.
Johari was responding to a query from Permatang Pauh MP Datuk Seri Dr Wan Azizah Wan Ismail, who asked the Finance Ministry on the increase in revenue from petroleum products following the rise in global oil prices since the announcement of Budget 2018.
On average, Johari said, for every US$1 per barrel increase in global oil price, the government’s revenue would increase by around RM300 million a year.
That amount does not take into account dividends from Petronas.
He added the difference between US$67 and US$52 per barrel for a period of less than two months would not provide an accurate picture on the real impact, as oil prices were always fluctuating.
“For example, if the average oil price was US$67 per barrel for the entire year, based on an
estimate where we will see a RM300 million revenue increase for every US$1 above US$52 per barrel, then we will have a RM4.5 billion increase in revenue.
“If the average annual oil price is US$60 per barrel, we will see an additional RM2.4 billion in annual revenue,” he added.
Johari also said additional oil revenue utilised for the country’s development has reduced reliance on petroleum-related income to 14% today from up to 41% in 2009.