The government will take steps to reduce the peopleâ€™s burden if global crude oil prices rise drastically, says Prime Minister Datuk Seri Najib Razak.
Najib also said the implementation of the managed float system for retail fuel products such as RON95 and diesel would be beneficial to the people.
â€œThis system is more beneficial to the people as petrol prices in the country will go down and be commensurate with current global crude oil prices,â€ he said in an audio clip on his blog www.najibrazak.com today.
â€œHowever, if global crude oil prices increase drastically, the government will take steps to reduce the peopleâ€™s burden,â€ he said.
Najib said the current managed float system was introduced by the government as global crude oil prices had gone down to a level where petrol subsidies were no longer needed.
Najib, who is also finance minister, said the abolishing of petrol subsidies would prevent the country from losing billions of ringgit due to illegal smuggling and purchasing of petrol by foreigners.
He pointed out that as the costs of government-subsidised petrol were borne by the people, foreigners did not deserve to purchase fuel from Malaysia at a lower price.
â€œThis managed float mechanism will help generate bigger savings for the government, and these savings will ultimately be channeled back to all Malaysians,â€ Najib said.
On Nov 21, the government had announced that beginning Dec 1, petrol subsidies would be removed and retail petrol prices would be set according to the managed float mechanism.
Last Monday, the retail price for RON97 petrol went down nine sen to RM2.46 a litre, and the retail price for RON95 petrol went down four sen to RM2.26 a litre.
Meanwhile, the retail price of diesel went up three sen to RM2.23 a litre.-NST