Petrol Prices In Malaysia updated 9th January 2014

Budget 2014: More petrol price adjustments seen next year Updated:October 26, 2013

ECONOMISTS and analysts expect more adjustments in petrol prices next year, in line with the Government’s subsidy rationalisation plan, which aims to lighten the burden on the country’s fiscal deficit.
“The hint in that the petrol subsidy is going to be the focus in terms of subsidy rationalisation. I expect more frequent price adjustments in the future,” said Malaysian Rating Corp Bhd chief economist Nor Zahidi Alias.

He believes that adjustments will be made after the first quarter of 2014, when concerns over the budget battle in the US economy and the lower targeted gross domestic product growth of below 8% in China are more settled.

It is anticipated that a new subsidy reduction will generate at least RM3.3bil in savings. “At current global oil prices, assuming a revision of fuel subsidies at 20 sen, it will generate an additional RM3.3bil in savings,” said Alliance Research economist Manokaran Mottain.

The recent hike in RON95 and diesel by 20 sen to RM2.10 and RM2 per litre respectively is expected to bring savings of RM1.1bil from September to December, and RM3.3bil per year.

For 2014, the Government will reduce subsidies to RM39.4bil, primarily from lower provision of fuel subsidies. This year, almost RM47bil was allocated for various subsidies, incentives and assistance, including subsidies for petroleum products, food, health, agriculture and fisheries, utilities, toll as well as welfare and education.

In his speech, Prime Minister Datuk Seri Najib Tun Razak said some RM24.8bil or 53% of the total subsidies was used to subsidise petroleum products.

“A portion of the savings from the restructuring of the subsidy system will be distributed in the form of direct cash assistance, while the other half will be used to finance development projects,” he said.

Besides subsidy rationalisation for petrol, the Government also proposed to abolish the sugar subsidy of 34 sen, effective today. The abolishment of the sugar subsidy is expected to bring RM1.1bil in savings.

The Government will also allocate RM2.4bil for subsidies and incentives, including those for fertilisers, seeds, price of paddy and rice as well as incentives for higher production of paddy and fish landing.

Due to the implementation of the goods and services tax, as well as subsidy reductions, he expects inflation to come in at around 2.8% in 2014. He added that inflation could rise to between 3% and 4% in 2015.

“However, the Government has taken steps to ensure that the needy will be somewhat compensated. In the long-term, the subsidy rationalisation programme makes sense, as it reduces the burden on the Government’s coffers,” he said.

Ahmad Maslan: No increase in RON 95 petrol prices Updated: January 9, 2014 

KUALA LUMPUR: There will not be an increase in RON 95 petrol prices Thursday night, and rumours of a supposed hike are untrue.

"There will not be a 20 sen reduction in RON 95 subsidies tonight (Thursday), contrary to rumours," Deputy Finance Minister Datuk Ahmad Maslan tweeted.

The subsidised price of RON95 petrol is currently RM2.10 per litre.

For other updates >> http://paultan.org/2013/09/02/ron-95-diesel-go-rm2-10/

Up to date prices for gasoline (unleaded) are available at>> http://www.mytravelcost.com/petrol-prices/