KUALA LUMPUR, Oct 16 ― The government will monitor global oil prices before reviewing the retail price for petrol, said Domestic Trade, Cooperatives and Consumerism Minister Datuk Seri Hasan Malek. 

Yesterday, oil prices reached the lowest level in four years, owing to the weak global demand with the benchmark Brent at US$83.37 a barrel (RM272.93).

“We have no plans to review the fuel price but we will work with the Finance Ministry and Bank Negara Malaysia to monitor the price of crude oil.

“We will only make a decision if there is a need,” said Hasan, as reported by the New Straits Times today.

Meanwhile, Petroleum Dealers Association of Malaysia (PDAM) president Datuk Hashim Othman warned that other factors would affect the outcome.

“Before reviewing the price, the government needs to forecast many things, including the (state of the) country’s and the world’s economy in the next few months.” He said.

Hashim said, the country’s petrol and diesel prices at petrol stations are regulated by the government with the Automatic Pricing Mechanism (APM).

“According to the APM, the difference between the retail price and the actual price will be borne by subsidies and sales tax exemptions,” he said.

This system allows the retail price of oil in Malaysia, to not be affected by the fluctuations in the cost of fuel production.

“APM standardises the price of fuel at pump stations, fixes the margins of oil companies and dealers, ensures distribution channels are secure, and minimises disruptions of petrol and diesel supply,” he said.

The APM, introduced in 1983 takes into account several factors such as operational and production costs as well as the profit margins of oil companies and dealers.