PUTRAJAYA: There will be no further fuel price hikes this year — that is the government’s promise.
The price of petrol will be retained at RM2.70 per litre and diesel at RM2.58 per litre, despite the higher world price of crude oil.
Pump prices could even go below current rates if the world price drops.
Prime Minister Datuk Seri Abdullah Ahmad Badawi said the government was sensitive to the plight of the people who would face difficulties in adjusting to higher pump prices.
“As such, the cabinet decided that the price of petrol and diesel will not be raised further this year,” he said at a press conference at his office yesterday.
When the government raised fuel prices last week, the market price was RM3 per litre. As of yesterday, it was around RM3.45 per litre.
Abdullah said the price of crude oil had risen to US$139 (RM445) per barrel on June 8 and was still trading at above US$130.
“If the government raises pump prices with the 30 sen subsidy, the pump price for July ought to be RM3.15 instead of RM2.70.
“However, if the world price drops, we will use the 30 sen subsidy adjuster as a discount on pump prices.”
On how government revenue would be affected without further price hikes this year, Abdullah said savings from the reduction in fuel subsidies would be wiped out because the world oil price was expected to remain high in the coming months.
“We’re not expecting additional revenue. Next year, we’ll review it again. Even if the oil price goes up to US$200 this year, this is our decision. It will cause difficulties for the government and we will have to think of other ways to bear the cost.”
In another move to help the 1.2 million civil servants, Abdullah said their salaries would be paid twice monthly.
“From August, salaries will be paid in mid-month and the balance will be paid at the end of the month. Deductions for income tax and others will be made at the end of the month.”
He urged the private sector to consider a similar move to help employees manage their cash flow and expenditure.
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