By ALIFAH ZAINUDDIN / Pic By MUHD AMIN NAHARUL
The government has lowered the retail price cap for the RON95 petrol from RM2.20 to RM2.08 per litre to protect Malaysians from the effects of volatile global oil prices.
Finance Minister Lim Guan Eng said the Cabinet agreed in a meeting yesterday that the retention rate for RON95 petrol should be reduced to RM2.08 per litre, based on the current market trend for petroleum products.
The ceiling price for diesel was maintained at RM2.18 per litre, while the premium RON97 is open to market rates.
“This means that the retail price of RON95 will be limited to RM2.08 per litre even though world oil prices are higher than that.
“If world oil prices are below that level, the weekly price of RON95 petrol will be below the RM2.08 level,” Lim said in a statement yesterday. He added that the retail prices of RON95, RON97 and diesel based on the automatic price mechanism calculation will continue to be announced weekly.
Oil prices rose to a three-month high of US$67 (RM272.17) per barrel last Friday on the back of the rising US stock markets and a decline in drilling activity, before moving back slightly to about US$65.90 per barrel yesterday amid a tight market.
Lim said the reduction of the RON95 retail price ceiling is in line with the commitment of the Pakatan Harapan government to reduce Malaysians’ cost of living.
In January, the government announced that retail prices for petroleum products would be retained at not more than RM2.20 and RM2.18 per litre for RON95 and diesel respectively.
The prices would be maintained at that level until the implementation of RON95’s targeted petrol subsidies in mid-2019, before the retail prices of petroleum products are floated at market prices.
Domestic Trade and Consumer Affairs Minister Datuk Seri Saifuddin Nasution Ismail (picture) had said the government is now in the final phase of identifying eligible recipients of the targeted petrol subsidies to be implemented in the second quarter of this year (2Q19).
He said the list of eligible recipients for the targeted subsidies, which is derived from the government’s existing e-Kasih data, is in accordance with household incomes.
Saifuddin Nasution added that the vendor selection process had also reached its peak, with the Finance Ministry expected to announce the selected vendor to develop a targeted RON95 petrol subsidy programme implementation system soon.
In Parliament earlier this year, Lim revealed that subsidies for RON95 and diesel between January and November last year amounted to RM4.89 billion. He said for the month of November 2018, some RM4.1 million was spent to subsidise RON95 and another RM209.1 million for diesel.