GEORGE TOWN: The current prices of petrol and diesel will be maintained until next March even if world oil prices touch US$200 (RM660) a barrel, said Datuk Shahrir Abdul Samad.
The domestic trade and consumer affairs minister, however, said he hoped world prices would not stay at such levels for long, leaving the government no choice but to review the subsidised prices of local fuel.
“It is going to be very challenging but we are handling the situation,” he said after opening the 32nd annual general meeting of the Penang Malay Contractors’ Association here yesterday.
“I hope the rise will not stay for long,” he said in response to the spike in world oil prices on Friday, which hovered at a record US$137 a barrel.
He was also commenting on reports that oil might reach US$200 a barrel.
On Wednesday, Prime Minister Datuk Seri Abdullah Ahmad Badawi announced an increase of 78 sen per litre for petrol and RM1 a litre for diesel. The pump price for petrol is now RM2.70 and for diesel RM2.58 per litre.
Abdullah also announced cash rebates of RM625 to owners of private vehicles with engine capacities of up to 2,000cc, pick-up trucks and jeeps up to 2,500cc, and RM150 to owners of motorcycles with capacities of 250cc or less.
Shahrir said it would be impractical to further raise the prices of petrol and diesel until next March.
“The recent fuel price hike is significant and it is not practical for us to do so again in a short span of time.”
The government will save close to RM14 billion this year from the subsidy cuts.
On calls that ministers’ allowances be reduced as a result of the fuel price increase, Shahrir said: “Our allowances are not much and if the people are suggesting this out of frustration, then it is unfair.”
He said the government was already reducing its discretionary expenses.
Shahrir also touched on the proposed implementation of the Fair Trade Practices Act, which would empower the government to monitor tra-ders and ensure healthy competition. The act will be tabled in Parliament this year.
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