Meet us on fuel price structure, petrol dealers urge govt

PETALING JAYA: The Petrol Dealers Association of Malaysia wants the government to hold a discussion with its members before switching to a weekly float system.

While the association welcomed the lower prices for petrol products, including RON95, a weekly float system would ultimately create losses for dealers should crude oil prices keep falling, said its president Datuk Khairul Annuar Abdul Aziz.

His remarks followed a Finance Ministry announcement that a weekly float system will be used to determine fuel price for RON95 from Jan 1 onwards due to the falling prices of crude oil.

“As dealers, we have no control over the price. Say we buy petrol today, if the Government changes the price tomorrow, we have to follow that even if we had bought (the fuel) at a higher price.

“Unlike other businesses where they can still keep a margin, we can’t, as we are at the mercy of the Government.

“So, let’s say the price goes down every week, we are then hit (with losses) four times a month,” he said when contacted.

Khairul said dealers could not even determine how much to stock, as the decision was up to the oil companies.

“So we can’t even buy less stock; our hands are tied,” he added.

He said petrol dealers usually have a RM0.10 per litre margin for petrol, so if the price decrease was more than that, the dealers would operate at a loss.

“If the reduction is gradual and doesn’t eat up our margin on a daily basis, then it would be okay but the Government needs to discuss with us. It’s right that the government wants to give that (lower fuel prices) to the rakyat and we are all for that, but if we continuously sell at a loss, matilah (we will suffer),” he said.

His suggestion to the government is for them to allow dealers to use the consignment system when buying fuel.

“The mechanism needs to be win-win for all,” he added.