Subtle_Fortitude

…strength of mind can be stronger than you think

Aiya! Petrol Price Hike!

Posted by nuruliman45 on June 14, 2008

Yup. Everyone’s talking about it. Petrol prices have skyrocketed!!! It’s the end of the woooorld!!! …not.

…sorry, a little dramatic there :-).

Quite old news, but I couldn’t help but have a fair say in this.

No one is happy (probably except the Government) about the new prices of petrol and diesel where petrol prices went up RM 0.78 from RM1.92 to a whopping RM2.70, while diesel prices raised RM1.00 from RM1.58 to RM2.58. In order to soothe the souls of the rakyat, the Government has promised us certain rebate subsidies to cover a bit of our loss in this.

Ok. Everyone knows this. Everyone is experiencing this mayhem.

Now, there are 2 main things going through my mind:

1. It’s funny how Malaysia is among the net exporters of petrol, and yet we are suffering as much as other countries are with the global rise of petrol prices. (Petronas, where are you??)

2. The Government seems quite generous and all with the new subsidy offers, but it doesn’t seem realistic in the long run. Rebate in three minutes? hmmm…take out your stopwatches!!

Elaborating a bit on the first point…

According to The Star, 5 June, we’re pretty much saving on petrol prices compared to our neighbouring countries:

PUTRAJAYA: The Government announced yesterday an increase in petrol and diesel prices, stating that it can no longer continue to subsidise fuel.

Prime Minister Datuk Seri Abdullah Ahmad Badawi said the new prices were still at a 30-sen per litre discount from market prices.

In other words, if the market price is RM3 per litre, Malaysians will be charged RM2.70 at the pump. He said the price would be adjusted monthly based on the global oil price.

“Malaysians still pay lower than the market prices as far as petrol is concerned,” he told a packed press conference when announcing the restructuring of the subsidy package.

Abdullah said that although the restructuring would result in consumers having to pay more, prices were still lower compared with Singapore and Thailand.

The rakyat was presented with this comparison of oil prices:

What neighbouring countries are paying for petrol

From: Article (The Star Online)

Now, why compare with countries that are not net exporters of crude oil like Malaysia is??? Of course our prices would be lower than theirs! Are they major producers of oil? No! We should be comparing our prices with countries with the same ‘oil status’ as Malaysia, or in other words, countries who are also major producers of crude oil. Try looking at Qatar, Kuwait, or Saudi Arabia and their oil prices.

Here’s a chart of Global Oil exports, now is Thailand and Singapore there??

CONCLUSION: We’re not saving that much

Global oil exports

Global Oil Exports

About the subsidies…

Great, there’s the RM625 per year subsidy rebate for private vehicles with engine capacity of 2000cc and below, etc… But a new subsidy system means new means of managing this system. Now, this means cost – the whole cost in managing the subsidy system itself.

And how sure is the Government that certain people (the wrong certain of people) wouldn’t take advantage of this subsidy rebate? Hm. More cost in prevention of this. Everything has to be taken account for.

So, what is left? Where’s the part that we are supposed to save? Is the rakyat aware of all this?…

… Only time will tell.

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