Rafizi Defends “Surprise” Fuel Price Hike Statement

Minister of Economy Rafizi Ramli recently defended the government's approach in subsidy rationalisation, which involves making sudden announcements without advance notice. He argued that this strategy is necessary to prevent traders from exploiting the situation by repeatedly hiking the prices of goods.

During an oral session in the Dewan Rakyat, Rafizi explained that giving advance notice would lead to multiple price increases by traders. He emphasised that the government's decision is better made and implemented without prior warning.

However, it is known that the diesel subsidy rationalisation was actually announced much earlier by Prime Minister Datuk Seri Anwar Ibrahim on May 19. He also announced that the Cabinet had approved the commencement of the diesel subsidy rationalisation program.

This program is expected to save the government around RM4 billion annually.

Subsequently, on June 9, Finance Minister II Datuk Seri Amir Hamzah Azizan declared that the price of diesel at all retail stations in the Peninsula would be set at RM3.35 per litre. This reflects the market price without subsidy. The price was based on the May 2024 average according to the Automatic Pricing Mechanism formula and took effect the following day.

Last month, Prime Minister Anwar stated that the government had not yet made a decision on whether to rationalise the RON95 petrol subsidy. Rafizi faced criticism for jokingly suggesting that the RON95 subsidy rationalisation would also come as a "surprise."

Former Deputy Minister Ong Kian Ming warned that a similar approach to petrol subsidy rationalisation would face even greater public opposition due to the larger number of users affected.