The retail price of petroleum will go down from midnight today for the period from Jan 5 to 11, 2019, the Finance Ministry said today.
For the period, RON97 petrol will cost RM2.23 per litre, down from RM2.50 per litre, while RON95 petrol will cost RM1.93 per litre, down from RM2.20 per litre, and the price of diesel will drop to RM2.04 per litre from RM2.18 per litre.
“The federal government will set the retail prices of petroleum products weekly so that consumers can benefit from any price changes more quickly in line with the downward trend in petroleum prices on world markets,” said Minister Lim Guan Eng in a statement today.
After Jan 11, the Automatic Pricing Mechanism (APM) will be implemented.
Under the APM, weekly fuel prices will be announced every Friday and will be in force the following day until the next Friday.
Lim added that the new fuel prices took into account the additional commission or margins of the petrol station dealers that was approved during the Cabinet meeting on Jan 2.
He said the decision to standardise the retail petrol prices considered the views of all concerned, including the request by the Petroleum Dealers Association of Malaysia (PDAM).
PDAM was previously against the weekly pricing mechanism as it said its dealers would be exposed to the risks of oil price fluctuations.
It had urged the government to raise the fuel sale commission for fuel station operators to reduce any loss they might face due to the weekly fuel price float.
“The government has also agreed that the margins of the petrol dealers be standardised to 15 sen per litre for RON95 and 10 sen per litre for RON97, while it will be 10 sen per litre for diesel.
“This is an increase of 2.81 sen per litre for petrol and 3 sen per litre for diesel compared with current rates which are 12.19 sen per litre for petrol and 7 sen per litre for diesel,” he said, adding that the margins for petrol dealers had remained unchanged since 2008.
He also said the government was committed to implementing the retail petrol price stabilisation policies and at the same time, to carry out pricing that would benefit the people.
“This means that when world petrol prices drop, the retail petrol price will also fall which will allow consumers to benefit from the falling oil prices immediately,” he said.
Lim added that to protect consumers from the increase in petrol prices, the retail petrol prices will be capped at levels below RM2.20 per litre for RON95 and RM2.18 per litre for diesel through the implementation of subsidies.
“This new method is an initiative of the Pakatan Harapan federal government that has never been practised before,” said Lim.
He also said targeted subsidies for RON95 will be introduced in mid-2019.