Petrol Price is a Plight

It was in 1994 when Tom Hanks starred in Forrest Gump and said “Life was like a box of chocolates.  You never know what you’re gonna get.”  No!  Tom Hanks, you’re awesome, but no!  We don’t like uncertainty and we especially don’t like it when it involves our bank account.

Unless you have been living abroad, or under a rock, you would have heard about the new petrol pricing system in Malaysia.  And as I write this as a dependent still, I was unfazed by it initially.  However, there was unbridled anger aimed at the new policy.  So, let’s take a look to see if the anger is warranted or unjustified.

If you didn’t know, petrol prices alter day by day.  As written in Astro Awani’s article titled “People Ready to Face the Inevitable, Weekly Fuel Prices”, the move to change petrol prices weekly is to fine tune the monthly managed float system.  It was felt that setting prices monthly did not accurately reflect the prices consumers were coughing up.  So think of it this way, if fuel prices are like a theme park pirate ship before the policy, then they will be like a kid’s ride after.

One misunderstanding that comes up from the implementation is that prices would be even more erratic.  That is not technically true.  Yes, fuel prices will change more frequently but the magnitude of the changes will actually be smaller.  In the article mentioned above, the price fluctuation will now be between 5 cents and 10 cents compared to the previous range of 10 cents and 20 cents.  See, the ship is not rocking as much.

Honestly, there is no unanimous position on that.  Some people rather have fewer changes albeit larger in magnitude whereas some people prefer smaller increments and decrements even if the change happens every week.  It depends on the personality and preference of the individual and hence, this will affect different people in certain ways.  I say to-may-to, you say to-mah-to.

In the Malaysian Digest article titled “Mixed Reactions to Government’s Policy to Update Fuel Prices Weekly”, Malaysian Muslim Consumers Association chief activist Datuk Nadzim Johan says that the new policy is beneficial.  The weekly pricing will minimize differences as it will be evened out to an average price.

But on the flip side, the article also talks about some concerns.  Federation of Malaysian Consumer Association (FOMCA) president Datuk Marimuthu Nadson fears deliberate confusion could be in play.  Marimuthu said that he received complaints about several petrol stations conveniently running out of fuel on a Tuesday right before a possible hike announcement the next day.  That’s as convenient as me grabbing discounted sushi on the day of its expiry.

We could be looking at the light at the end of the tunnel but we could also be descending into a dark vacuum.  According to Kantar Worldpanel data for 2016 Non-Food items, Malay shoppers have been largely responsible for the decline in trips.  And with such certainty surrounding this new policy, there is further emphasis for shoppers to load up whenever they can as every trip counts.

The new petrol pricing system has its anticipated pros and cons.  As such, we will only be able to tell if this system works if it is put in place for a while.  Stay on your toes because you have to keep yourself updated with the price changes.  And if things go south, I’m gonna bury myself in uncertain fillings of Cadbury.