The Government’s current practice of adjusting fuel prices on a monthly basis is set to evolve into a weekly cycle. This was announced yesterday on by the Minister of Domestic Trade, Cooperatives, and Consumerism Datuk Seri Hamzah Zainuddin.
In his speech, which was broadcast live on RTM 1, the minister explained that moving forward, the Government will be announcing adjusted fuel prices every Wednesday which will subsequently take effect on 0:01 the following day.
The first announcement will happen next Wednesday, 29 March with the announced prices set to take effect on 0:01 Thursday, 30 March.
“When we used the current system of a monthly managed float, we found that fluctuations in fuel prices were so drastic that it resulted in unease among consumers and fuel retailers alike,” Hamzah said.
Hamzah went on to explain, “To improve on the mechanism that is currently in use, the ministry performed several consultation sessions with the fuel companies, station operators, several NGOs, and other industry stake holders.”
Results of these discussions were presented to the Cabinet which agreed on 22 February to switch management of fuel prices to a weekly cycle.
He went on to remind fuel companies and retailers that stern action will be levelled against parties that sell petrol or diesel at prices other than what’s announced. Companies wishing to offer promotions in the form of discounts are allowed to do so subject to permission from the ministry.
In a subsequent media Q&A after the announcement, Hamzah said that Wednesday is chosen as the day for adjustment in fuel to minimize disruption in supply to the stations. Adjusting fuel prices over the weekend is not feasible as logistics companies responsible for transporting fresh supply of fuel are not in operation.
The Government will continuously review the effectiveness of this new pricing system, and may implement measures to further improve it in a year’s time.