Govt to maintain float system in fixing fuel prices

KUALA LUMPUR: The retail prices of fuel will be maintained on a managed float system based on the world price of crude oil which is currently trading at US$63 per barrel, Second Finance Minister Johari Abdul Ghani says.

He said in 2008, the world crude oil price reached US$140 per barrel and RON 95 then was retailed at RM2.70 per litre compared with RM2.31 per litre now.

“When it comes to a stage where we have to have a discussion, we will discuss it. As for now, we have to remember that it was US$140 per barrel before,” he told reporters at the Kampong Bharu Food and Arts Festival 2017, organised by Kampong Bharu Development Corporation here today.

Johari, who is also Titiwangsa MP, said although the fluctuating price of crude oil was beyond the government’s control, it could still monitor the situation and distribute the 1Malaysia People’s Aid (BR1M) to prevent the lower income group from falling into poverty.

“Today’s float scheme will be maintained as we cannot change it, as (the world crude oil price) is beyond the government’s control.

“It’s still far from what we have seen, and it’s still manageable at around RM2.31 per litre,” he said, adding that the government could not do anything about rising crude oil prices as it was determined by the world market.

“Malaysia now has a population of 31 million and is the 25th largest oil producer, not the first or second. If we were to look at other oil producers, some produce up to 11 million barrels a day,” he said.

“We cannot control the world’s crude oil production. What we can do is make sure that monitoring will be done so as to avoid causing hardship to the people,” he said.

He also commented on the stabilisation of the ringgit, saying the global outlook was good and that it was estimated that in 2018, the local unit should advance to around 3.80 against the US dollar.

“Since Malaysia is an open country and we are trading with all countries in the world, we are reaping the benefits now.

“With the increase in oil prices, and more foreign exchange expected, it will in turn strengthen the ringgit indirectly,” he said. -FMT