RON95 is now RM1.93 per litre, 27 sen down from RM2.20. RON97 is RM2.23 sen a litre, down 27 sen from RM2.50 while diesel is RM2.04 per litre, down 14 sen from RM2.18.
Petrol Dealers Association of Malaysia (PDAM) president Khairul Annuar Abdul Aziz was quoted by Astro Awani as saying all operators will continue to be patient despite being forced to absorb the losses due to the sudden drop in prices.
Finance Minister Lim Guan Eng said the new prices will take effect from midnight today.
This follows his decision last week for fuel prices to be fixed on a weekly basis using the Automatic Price Mechanism (APM).
Initially, the weekly float system was supposed to start from Jan 1 but was put on hold following protests from the PDAM. The association members later met Prime Minister Dr Mahathir Mohamad to discuss their concerns.
PDAM had requested the government to review the petrol dealers’ margin, which is a component under the APM, used to determine the retail prices of petroleum products.
Putrajaya has since agreed to increase the petrol dealers’ margin by 2.81 sen per litre for RON95 and 3.0 sen for diesel, bringing the total margins to 15 sen per litre for petrol and 10 sen per litre for diesel.
Khairul said he hoped the government would always ensure that open-door negotiations with PDAM will continue regarding the retail price mechanism.
He told FMT that today’s decrease in petrol prices was also a good decision given the current state of the economy. But he said that discussions are still needed over the weekly price mechanism.
“Weekly fuel prices are still something that will become an issue for the industry. We hope to be able to discuss (with Putrajaya) the mechanism for the weekly petrol prices so the supply of fuel is not affected.
“The petrol station operators are facing challenges, especially with rising operating costs, causing many to close shop,” he said, adding that the new petrol commissions will “give them some breathing space” to carry on.
Khairul previously said the PDAM wanted the government to follow a monthly float system so that dealers would have sufficient time to sell stocks according to the prices they had bought them for.
PDAM is against the weekly float system as dealers who buy their stocks at higher prices will have to sell it at a loss if the prices drop the following week.