Wednesday, 6 January 2016

New proposed pricing mechanism for RON95 not feasible: Treasury sec-gen

The new pricing mechanism proposed by a certain party for RON95 to be based on the actual production cost of Malaysian oil refineries denominated in the ringgit is not feasible, says Treasury secretary-general Tan Sri Dr Mohamad Irwan Serigar Abdullah.

The country's fuel needs are still being fulfilled by imports and denominated in the US dollar, he said, noting that the current pricing framework of a managed float system based on the Automatic Pricing Mechanism (APM) has witnessed reductions in the retail price.

"Even within the existing pricing framework, the retail price of RON95 has decreased seven times while diesel has decreased five times in the period from December 2014 to January 2016 since the implementation of a managed float system based on the APM.

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