The minimum price of petrol should be RM1.92 per litre even if the global oil price continues to fall, Domestic Trade and Consumer Affairs Minister Datuk Shahrir Abdul Samad said.
He said this would bring some stability to the retail price of petrol and minimise losses by petrol station owners.
Setting a minimum price would also enable the Government to reduce its subsidy on petrol if the global price fell further.
“The upper limit will be RM2.70 and it is my feeling that this is the optimal range,” Shahrir said when commenting on the losses petrol station dealers face whenever the price of petrol is reduced.
Ahmad Sarpur, a dealer in Johor, said dealers could lose between RM13,000 and RM25,000 each time petrol is reduced by 15 sen per litre.
“This is because there is a minimum order quantity of 21,000 litres that we must pay for immediately. There is no credit,” he said.
“If the petrol is delivered in the morning and the price is reduced at night, we have to sell petrol 15 sen cheaper than what we had paid for it.”
However, Shahrir said the Government had been fair to the dealers saying: “We have not reduced their margin of 12 sen per litre after it was increased in June and we will try as much as we can to keep upcoming price reductions to 15 sen at a time.”
Shahrir said this meant a minimal loss of three sen per litre.
Ahmad pointed out that it was difficult for dealers to hedge on prices as they were not given prior notice of price changes. He said the dealers should be given three days’ warning before a price change to carry their optimal amount of stock.