The government has assured that RON 95 petrol prices won’t see huge price hikes once the targeted oil subsidy system comes into effect in Q2 of 2019.
The Sun Daily reports that users which aren’t eligible for the subsidy need not worry, as price increases of RON 95 petrol, if required, will be implemented in stages as a substantial petrol price hike will have a negative impact on the Consumer Price Index (CPI) and lead to inflation.
Domestic Trade and Consumer Affairs Minister Datuk Seri Saifuddin Nasution Ismail added, “Say on the first day of execution (of the floating price system), the price difference is 30 sen. We do not want that to happen. Although it should be increased by 30 sen, it will be done gradually within a certain period of time, for example between six to eight months,”
Nasution said that the ministry has studied the impact of petrol price hikes to the CPI with the Department of Statistics Malaysia, and will take this into account during the implementation of the float pricing of RON 95 petrol.
The government has yet to determine if the float price will be set on a weekly or monthly basis but has taken into account the feedback from petrol companies, dealers, retailers, and the general public.
The targeted oil subsidy program will be implemented once a comprehensive study is completed by an independent entity/company regarding the design, supply, testing, monitoring, hardware, and software updates required to effectively introduce the system.