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Fuel Prices Expected to Drop Three To Four Sen

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With fuel subsidies to be removed from Monday, the fall in global oil prices to a four-year low has consumers in the country hoping for a drop not only in fuel prices but also in transportation charges, making for cheaper goods and services.
Domestic Trade, Cooperatives and Consumerism Ministry secretary-general Datuk Seri Alias Ahmad said a slight drop in fuel prices was expected.

“We are calculating the average market price for RON95 and diesel in November and will use this figure to determine the new pricing for December.

“Based on the market trend, there may be a drop of three or four sen,” he said.

However, transport operators prefer to remain non-committal.

Pan-Malaysia Lorry Owners Association president Jong Foh Fit said it would depend on individual operators whether or not to reduce fees.

“According to provisions in the Malaysian Competition Act, we cannot force operators to cut their prices,” he said.

Pan Malaysian Bus Operators Association president Datuk Mohamad Ashfar Ali said prices would only come down if the Government were to allow operators to set their own ticket prices.

He said with the current ceiling on bus fares, the operators could not afford to charge less even if fuel prices went down.

Land Public Transport Commission chairman Tan Sri Syed Hamid Albar said the agency would be meeting the Pan Malaysian Bus Operators Association to discuss the deregulation of express bus ticket prices.

“I think there is a case for us to look into this,” he said.

Malaysian Consumers Association (Fomca) director-general Datuk Paul Selvaraj argued that a drop in fuel prices should be accompanied by a drop in transportation charges and the prices of goods and services.

“Previously, we always had issues with traders increasing their prices every time the Government announced a reduction in fuel subsidies, so we are hoping for an opposite reaction this time,” he said.

Ashfar countered Fomca’s argument by pointing out the situation of bus operators.

According to him, the average express bus used 6,000 to 7,000 litres of diesel every month, of which only 2,880 litres were bought at the subsidised price of RM1.88 per litre.

“We have to buy the remaining fuel at full retail price,” he said.

The Government is removing its subsidies on RON95 petrol and diesel on Monday and will move to a managed float system to determine pump prices.

Alias said radical price changes were unlikely due to the Government’s decision to implement a managed float system.

“Malaysians will only notice a slight change, if any, on the first of every month starting from December.

“The price for each month will be tabulated based on the average world market pricing for the month before,” he said.

He said petrol dealers and other stakeholders would be informed of any price change just before midnight on Nov 30.

“RON95 and diesel at petrol stations nationwide will start selling at the new prices beginning 12.01am on Dec 1,” he said.MYNEWSHUB


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