More People To Switch To Ron95 After Ron97 Hits Record High


 
With the increase in the price of crude oil, the total cost of subsidies for RON95 and diesel had gone up 10 times, says Tengku Zafrul Aziz.PETALING JAYA: Petrol station owners are expecting more people to switch to the RON95 fuel after the increase in the price of crude oil saw the higher grade RON97 reach a record high of RM3.75 a litre.
However, Petrol Dealers Association of Malaysia (PDAM) president Khairul Annuar Abdul Aziz said there was no shortage of RON95 petrol at the moment despite the “huge” price gap with RON97.
“There are fewer people on the road, perhaps because of the school holidays,” he told FMT.
On Feb 24, Russia launched its invasion of Ukraine, triggering a spike in world crude oil prices to more than US$100 per barrel for the first time since 2014. Oil prices went on to top out at US$130 earlier this week, a 20% increase from where they were just a month ago.
This has directly impacted fuel prices in Malaysia, with RON97 petrol rising by 16 sen from RM3.29 to RM3.45 on March 2, and another 30 sen to RM3.75 from today.
By comparison, the prices of RON95 and diesel have remained at RM2.05 and RM2.15 per litre, respectively, because of government subsidies.
According to finance minister Tengku Zafrul Aziz, the rise in crude oil prices had already cost the government up to 10 times in oil and gas subsidies over the previous year, from RM200 million in January 2021 to RM2 billion in January this year.
Now, in light of the ongoing conflict, he said oil and gas subsidies could exceed RM2.5 billion a month.
“If oil prices remain above US$100 per barrel, total subsidies for 2022 are expected to reach RM28 billion, compared with RM11 billion for 2021,” he said. - FMT


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