Putrajaya Mulls Fuel Price Ceiling

Putrajaya Mulls Fuel Price Ceiling

Putrajaya is considering a price ceiling for fuel to tackle the impact of escalating oil prices.

Second Finance Minister Johari Abdul Ghani said in certain countries, governments left fuel prices afloat, where oil and gas industry players would determine them.

“It is up to the government to set a ceiling which is deemed fair for all.

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“When we (the government) have decided on the ceiling price, whether they (oil and gas industry players) want to sell the fuel at lower prices for promotion purposes, we leave it to them. This is one of the options we are looking at,” he told reports on the sidelines of Chinese New Year celebrations hosed by the Malaysia Retail Chain Association in Kuala Lumpur on Tuesday night.

On the reintroduction of subsidies, Johari said it would not be good for the Malaysian economy as they were unsustainable. After the elimination of all direct subsidies in 2014, fuel prices are set using a managed monthly float.

Malaysia’s fortunes are closely tied to energy markets. It is the only net exporter of oil among Asia’s major economies and the second-largest liquefied natural gas exporter in the world. Making matters worse, the ringgit also tends to mirror the movement in oil prices.

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