Fuel prices – weekly revisions, and the current state of affairs

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It’s been more than a month since the Government launched its new fuel price initiative, where fuel updates were to be announced weekly with the sole purpose of reducing uncertainty of flailing fuel prices to the rakyat; the new arrangement would level out these spikes, allowing to soften the blow of drastic changes between months. But to some of us, increased costs are the same no matter how you spin it – so far, has this arrangement have had any benefit to us?

Right after the weekly pricing initiative was launched, fuel prices dropped steeply – RON97 experienced a 19 sen drop, along with other fuel types and grades which experienced a similar fall. In hindsight, this was probably done to advocate the new system and to reduce backlash on its ‘effectiveness’ because on the weeks that followed, prices climbed back up sen by sen till the last week of the month where RON97 finally stood at RM2.54 per litre, bringing the month’s closing to a mere difference of 3.13% comparing with the month before the initiative.

But you might ponder; mostly all of us who rely on own cars to work and places would pump our vehicles several times in a month – surely there must be some savings there with these adjustments? To figure that out, let’s put ourselves in a situation to assess this case.

Assuming you stay in Subang and your office is in KL Sentral which is a good 20 kilometers one way, which means you would have travelled 40km daily. To keep things simpler, let’s also assume you drive the same distance on weekends, so that’s about 280km in a week – and that makes out to be about 1120km in a four week period. You also own Malaysia’s favorite car, the Myvi which has a 30 litre fuel tank excluding the reserves, which you can probably get about 400km from a 30 litre fill up before the low fuel indicator comes on.

Now let’s put those numbers together. Pumping a full tank of RON95 on the last day before the weekly pricing arrangement – let’s call this Week 0 – will cost you RM69 (RM2.30 * 30), which you can drive until Week 2 which will now cost RM2.16 a liter, to a total of RM64.80 (RM2.16 * 30). The same situation goes on, where you will have make another visit to the petrol station which will now cost you RM67.20 (RM2.24 * 30) to fill up to your tank’s brim – which makes out to RM201 in a single month in fuel costs.

As opposed to the monthly float, you would initially pay RM69 for the first week and RM68.10 (RM2.27 * 30) for the subsequent weeks which sums up to RM205.20, using figures for April’s final week. All of these numbers, in this hypothetical case makes out to a measly RM4.20 savings – enough for a roti telur, teh tarik and some change to pay the parking meter.

Of course, your savings could potentially improve depending on the time of the week your car runs out and the size of your fuel tank, but this example serves to show how much one could save (and also lose!) with a system that updates its prices at a higher frequency. In the situation which KPDNKK finally decides to allow its ruling on station owners able to set their own prices, things may finally take a turn for the better.

So it’s rather true what those around you may have said – given that the prices for April are somewhat a special case, you shouldn’t expect any significant amount of cash saved from this entire roller-coaster of events. For now, if you’re looking to fill up but undecided to do it now or after, our advice is to just do so – you probably won’t miss your monthly visits to your local mamak for the sake of it.

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Having a penchant for cars since youth, he firmly believes that speed and stature go hand-in-hand. He enjoys the occasional spirited drive and can be found personally grooming his cars from time to time.

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