Dr Wee: Adjust diesel gradually so businesses, consumers can breathe
PETALING JAYA: Putrajaya could have managed the recent diesel price hikes more effectively to shield the public from sudden inflationary shocks, says Datuk Seri Dr Wee Ka Siong.
The MCA president offered two key suggestions. Firstly, he urged the government to raise diesel prices gradually rather than in sudden jumps.
“If the government still wants to revise diesel prices, it should be done prudently, little by little, so the market can adjust, businesses can plan and the people can breathe,” he said.
Secondly, Dr Wee said the government should use the nation’s financial strength to cushion the impact of rising global fuel prices on consumers, similar to measures taken by neighbouring countries.
He noted that diesel currently costs RM3.93 per litre in Thailand while in Indonesia, it costs RM1.85 per litre for personal use and RM3.80 per litre for commercial vehicles.
“With these prices, refuelling a Toyota Hilux in Indonesia would cost RM148 for personal use and RM308 for commercial use, while in Thailand it would be RM314.40,” he said.
“The government’s duty is to protect the people, not to transfer price shocks directly to them.”
Dr Wee also warned that sudden price hikes place pressure across multiple layers of the supply chain, affecting raw materials, operations and transportation.
Sectors heavily reliant on diesel, including agriculture, construction, logistics and fisheries, face immediate surges in operational costs.
“The original diesel price was RM3, now it’s RM5.50. Businesses cannot absorb all these costs and they will inevitably pass them on to consumers. When transport costs rise, prices of goods rise,” he said.
He added that this creates inflationary pressure that is difficult to reverse.
“When diesel spikes, it’s not just diesel – the cost of food, essential goods and overall living expenses will rise. People are already struggling; don’t make life harder for them,” he stressed.
Various industries have raised alarms following the global oil price surge triggered by the Middle East conflict.
Malaysian Food Manufacturers Association president Ding Hong Sing said many companies are struggling with low margins and escalating expenses, with some facing additional monthly diesel costs of RM60,000 to RM80,000, and others expecting operating costs to rise by as much as RM100,000 once logistics are factored in.
Last week, the Federation of Malaysian Fruit Farmers Associations (FMFFA), the Fertiliser Industry Association of Malaysia and the Federation of Malaysian Manufacturers (FMM) called for urgent government intervention before the cost crisis trickles down to consumers.
FMFFA warned that farmers could face an irreversible contraction due to limited pricing power, while FMM highlighted Malaysia’s exposure to the Middle East conflict, noting that over 90% of its trade is transported by sea.
Freight rates for a 40-foot container currently range from US$2,400 (RM9,410) to US$3,100 (RM12,154), and could spike to US$6,500 if disruptions persist, with exporters also facing war risk surcharges of up to US$3,000 per container.
Tensions in the Middle East have escalated since Feb 28, following attacks by Israel and the United States on Iran, leading to the closure of the Strait of Hormuz.
According to the US Energy Information Administration, over 80% of crude oil and liquefied natural gas passing through the strait is bound for Asia.
