By BERNAMA / Pic By ISMAIL CHE RUS

The government will only recalibrate the 2019 budget if average crude oil price dip below US$50 (RM209) per barrel, said Finance Minister Lim Guan Eng.

The Ministry of Finance prepared next year’s budget based on crude oil prices of US$70 per barrel.

Lim said there is no necessity now to recalibrate the budget as the government is looking at average crude oil prices and not daily prices.

“Previously, when oil prices rose from US$52 to US$72 per barrel, we did not recalibrate the budget, so similarly it had gone down from US$72 to US$52 per barrel now.

“We will only consider recalibrating the budget if average crude oil price dips below US$50 per barrel,” he told reporters after flagging off the “Occupy Beach Street Christmas Run” in George- town yesterday.

However, Lim, who is also the MP for Bagan, said the market is quite volatile now, although analysts are still positive average crude oil prices could reach US$70 per barrel.

“You know nowadays, when Donald Trump (president of the US) says something and it will affect the price (of crude oil).

“For the time being, as long as average prices are still above US$50 per barrel, there is no need to recalibrate but we will continue to monitor prices and see how (prices move) next year,” he added.

Oil prices crashed to new one-year lows last Tuesday, erasing between 4% and 7% throughout last week, dragged down by a deepening sense of global economic gloom, as well as, fears of an oversupply in the oil market itself.

West Texas Intermediate dropped below US$47 per barrel and Brent fell to the US$56 level. The reasons for the sudden meltdown were multiple. — Bernama