Petrol prices went up again on Wednesday for the second consecutive week. RON95 went up seven sen causing much distress to the rakyat. But the government has pledged that it will always help the rakyat. How will the government go about it? Let us take a look.
Prime Minister finding ways to help the rakyat
Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi said on November 19, that the National Economic Council chaired by Prime Minister Datuk Seri Najib Razak will meet soon to discusss ways on how to deal with the recent fuel price hike.
This is an assurance to the rakyat that our leader Datuk Seri Najib will not abandon the rakyat and will always find ways on how to help them.
Government will help when oil prices reach a certain maximum limit
Datuk Seri Ahmad Zahid has given the assurance that the government will intervene if oil prices hit a maximum price limit.
The Deputy Prime Minister said the intervention was one of the options studied.
So the rakyat should not be worried as the government is always looking out for our welfare and will do all its best to take care of the rakyat.
Government will not allow the rakyat to suffer
Domestic Trade, Consumerism and Cooperatives Minister Datuk Seri Hamzah Zainudin said he was doing all he can to help the rakyat and did not want them to suffer due to the high fuel prices.
He said that his ministry will meet with Cabinet to help the rakyat go through the tough times.
This is a sign that the government is always concerned with the rakyat and will do all it can to help alleviate the people’s suffering.
Although the government cannot reveal what it plans to do, the rakyat should be rest asssured that their welfare is being taken care of.
The rakyat will get help
Second Finance Minister Datuk Seri Johari Abdul Ghani said if oil prices continue to climb, the government will help the rakyat.
Johari told reporters on October 16 that crude oil averaged US$52 per barrel in 2017 and is expected to average US$62 in 2018.
If this happens, the government will have an additional reveue of RM3 billion.
Johari said some of this profit will be given to the rakyat to help them ride over the tough times.
Net impact of weekly oil price floating mechanism is only one sen
Ever since the government introduced the weekly oil price floating mechanism, oil prices have gone down 12 times and gone up 19 times.
But Johari said the net impact is only one sen.
What it means is that oil price may have gone up 19 times to as high as RM2.40 sen.
But oil prices have also gone down 12 times to as low as RM2.39.
So there is a difference of one sen net impact.
So the rakyat must take a look at the bigger picture.
The rakyat should not monitor the oil price increase on a week to week basis.
The rakyat should monitor the oil price movement since March.
Oil price increase will benefit Petronas
Although oil price increase can be a burden to the rakyat, it can also be good for the country in the future.
This is because for every US$1 increase, Petronas will get an average income of RM300 million.
Petronas will then pay royalty to the government.
The royalty amounting to billions of ringgit is then used for the development of the country.
Development will bring economic prosperity for the rakyat.
Oil price increase still manageable
Johari said the oil price increase is still manageable and is not at the critical point.
At US$62 per barrel, the increase is still moderate and the rakyat can still afford it.
It will be critical if oil price hit US$140 per barrel in 2008 and could lead to extreme inflation in the economy.
But oil prices is now at US$62 which is still okay and manageable and the rakyat should not be worried.
Government still subsidise RM1.6 billion
The government however still helps some of the rakyat by subsiding diesel.
The government subsidise the fishermen to a tune of RM1.6 billion a year.
The subsidy is to help pay for their diesel when they go out to sea.
This is because there is no guarantee that they will return with a good catch of fish.
So that is why the government is subsidising fishermen to show that it cares.
OPEC will control oil prices and not make it too expensive
History has shown that the Organisation of Petroleum Exporting Countries (OPEC) will control oil prices.
The organisation will make sure that oil prices will not be be too expensive by bringing down production.
If the oil price is too expensive, there will be no demand from buyers.
And OPEC countries will lose out to shale producers such as the US and Canada.
So the rakyat should not be worried as OPEC will make sure that oil prices will not be too expensive.
Oil price is now expected to go down
Maybank Investment said on October 17 that oil price is expected to weaken to US$59 a barrel in the next few weeks after peaking at US$64 a barrel last week.
So this shows that oil prices are unpredictable and that the rakyat do not have to panic.
Oil prices can be high today but tomorrow it could go down again.
Bottom 40 and Middle Income 40 will be looked after
Johari said that the government will always take care of the bottom 40 percent of the rakyat with a low income or B40 as well as the M40 (middle income group which makes up 40 percent of the population).
Johari said the government will at the end of the day look at how much money it has after the oil price increase and eventually Prime Minister Datuk Seri Najib Razak will decide on how much the government plans to increase the BR1M.
Rakyat must also change
The rakyat must also play their roles to reduce dependency on oil.
As an example, they can use hybrid cars to save petrol.
They can use ride sharing cars to reduce petrol as well as save on parking charges.
The rakyat can also use public transport such as MRT and LRT.
So the rakyat must also play their roles to reduce dependency on oil.