Petrol Woes: Fuel Price Doubling Soon

*Attached is Malaysiakini's breaking news on fuel hike for your reference (Source unknown, but lifted from this blog) The Malaysian Government is expected to hike the fuel price again. This is going to be real bad when just about every essential items are costing more than ever. The worst part is that most of us will have no choice but to bite our teeth, as there is almost always no sensible alternatives. Apart from those who dwell in major cities, public transportation is almost non-existent in any other parts of the country. Even the buses and trains that ply the cities leave much to be desired.  If Government gets its way, petrol price will easily hit RM4 a litre. A full tank of petrol for a Proton Wira can cost as much as RM 100! In a country where fresh university graduates can only expect to earn a meagre RM2000 monthly, RM400 a month on petrol is just ridiculous (assuming the consumption of a full tank every week). Probably most of the population are earning much less than RM2000 a month! Sighs. I don't understand. Malaysia is a net exporter of petroleum. At a time when Government coffers are gleefully bloated from the insanely high price of petrol, the Government chooses to tell us that subsidizing the petroleum will cost more (RM 54 billion), ignoring the fact that we are actually earning much more from the same amount of petrol that we export too, thus better able to foot the bill.  Isn't it reasonable to expect an item to be priced affordably, if not cheap, for her citizen if we have them in abundance? Why burden the people?  I hope there are measures to make sure low-income citizens do not suffer from this whim of the Government. But the Government's track record in executing such measures just does not inspire confidence. Most of the time they don't even have a sound plan to begin with. That's Malaysian's plight.  --- Pump price at 'market levels by August'

Jun 3, 08 1:41pm

The government, which will announce the framework for its revamped fuel subsidy scheme tomorrow, has set the goal of raising the pump price to market levels by August, a minister said. "The prime minister will announce on Wednesday an indication of where we are going in terms of a fuel subsidy system," Domestic Trade Minister Shahrir Samad told AFP. "We have worked out the details of the subsidy plan and after the inflation committee meets today, it will have to be approved by cabinet (which will be meeting tomorrow)," he said. Malaysia is moving to cut the spiralling bill for its extensive petrol, diesel and gas subsidies, which is expected to cost RM56 billion this year. Currently petrol sells for about RM1.92 a litre, among the cheapest in the region. If petrol is to be sold at full market prices, it could be as high as almost RM4 a litre - about 100 percent above current levels. Shahrir said the details and implementation method of the new subsidy scheme would be thrashed out by August, when the full plan is scheduled to be in place. Gov't target: Market prices for petrol  "There are many smaller economic factors and issues that need to be sorted out so I don't think the full fuel subsidy plan can be delivered to the public today or tomorrow," he said. "What we are targeting for when the full plans are announced is that the price at the pumps throughout the country will be at market prices, so until the full plan is delivered, we will not be able to do this." Shahrir said the new subsidies would be a needs-based system, rather than the current arrangement which lowers the cost of petrol for all users no matter what their income. He told state news agency Bernama that the government was considering mechanisms including offering cash payments or setting quotas. The government is initially targeting Singaporeans and Thais who make day-trips across the border to fill their tanks with fuel that is substantially cheaper here. On Monday, it shut off petrol sales to Thais on its northern border and will also ban sales of petrol to visiting Singaporeans in Johor from June 9 as an interim measure ahead of the new subsidy mechanism. The government is braced for a public backlash over any further fuel price hikes, in a country where public transport is poor and many people are dependent on their cars. Since 2004, fuel prices have increased between 40 and 100 percent [see chart below]. The ruling coalition suffered its worst ever results in March 8 elections, losing five states and a third of parliamentary seats in a setback partly credited to anger over high prices of food and fuel. - AFP    (adapted from Malaysiakini)