Malaysia could be removing its price cap for RON95 petrol soon

Pixabay

A price cap on RON95 petrol in Malaysia could soon be removed, the Domestic Trade and Consumer Affairs Minister Datuk Seri Saifuddin Nasution Ismail has reportedly said.

The decision on the price cap will be made when a new petrol subsidy comes into effect, The Star reported on Tuesday (April 23),

This new subsidy is expected to be limited to recipients of the Bantuan Sara Hidup (BSH) 2019, which is a cash aid given to around 4.1 million households in the Bottom 40 (B40) household income group.

The price of RON95 petrol was previously capped at RM2.08 in February. At the time, the government said that the price applied for all users, regardless of fluctuations in global oil prices.

In February, the government announced that the price of RON95 petrol would be capped at RM2.08 for all users regardless of any increase in global oil prices.

Quoting Saifuddin, The Star reported that the Cabinet has not decided whether or not to remove or maintain the price cap.

“We will also have to decide on whether the targeted subsidies will be based on the current capped price, or on a float pricing system,” he reportedly said.

The New Straits Times reported that the new petrol subsidy is being finalised, and will be implemented once the list of B40 recipients has been updated.

According to The Star, Saifuddin also said that the new subsidy could come in the form of cash banked directly into recipients’ accounts.

If successful, the method of banking in subsidies could result in savings for the ministry.

“The savings we get from this more efficient form of disbursement can be used to enable more Malaysians to enjoy the petrol subsidy – particularly the M40 group (middle 40 per cent),” The star quoted him as saying.

Additionally, the government is also looking at other measures to help with the cost of living in Malaysia. For example, it is looking into the possibility of “removing the middleman involved in the supply chain” for goods before they reach consumers. This can help lower the price of goods for consumers, New Straits Times reported.