Up or down, there’s just no winning for petrol dealers

October 11, 2017

How is that? Are the house odds stacked against the playa?

Dateline 2017-08-30, FMT:

 Although petrol dealers hardly get any sympathy on social media when they complain about their losses, they are very much in a losing situation.

Speaking to FMT, Petrol Dealers Association of Malaysia (PDAM) president Khairul Annuar Abdul Aziz said this was because the profit margin for dealers set by the government through the automatic pricing mechanism hasn’t been reviewed since 2008.

Presently, the profit margin is set at 12.19 sen per litre for petrol and 7 sen per litre for diesel, but operating costs have doubled since then due to the implementation of minimum wages and increases in electricity tariffs.

Additionally, Khairul said petrol dealers absorb a 1% service charge imposed on customers who pay using credit or debit cards.

“So when fuel prices increase, our operating expenses decrease because we are buying the petrol low and selling high, but we are forking out more for the service charge on card payments because the value of that 1% increases.


“People Will Adapt” – Says O&G Industry Expert On Weekly Ceiling Price For Fuel

May 2, 2017

Changing colours like a chameleon, much?

Dateline 2017-03-17, MalaysianDigest:

Malaysians are still in the dark about how the new fuel ceiling price will be implemented as the ministry has yet to announce the mechanism for the new system until April comes.

While reactions of several stakeholders towards the announcement has been covered in Malaysian Digest’s feature story, someone within the oil and gas industry shared with us a picture of how it will play out once the system is in place.

Nora, a financial analyst in the oil and gas industry, said that nothing would be particularly different for consumers as they will adapt regardless of what system is implemented.

“I don’t think anyone has that much energy to really monitor the ups and downs every week and how it would translate to cash flow or money availability.


April 18, 2017

Dateline 2017-03-14, Cilisos:

Just 3 years ago, Malaysia was still a country with petrol subsidies, but that all changed when the gomen decided they weren’t going to pay for those subsidies anymore. Malaysia then moved to a float system, where the prices of petrol locally would be determined monthly by the prices worldwide.

For the longest time, our Editor-In-Chief had been wanting for one of us writers to write about how these monthly petrol prices in Malaysia are calculated. Sadly, it kept getting postponed either because of something more current or we just forgot. In fact, our saudara at SOSCILI ended up writing about it before us.

With the price of petrol and diesel going up in the past 2 months, we thought it would be a good time to translate their article. But as soon as this writer started researching about the topic, we realised that some major changes are coming where petrol prices are concerned.

Piped gas price in Peninsular Malaysia still sold below market price

January 19, 2016

Dateline 2015-12-14, The Star:

The price of piped gas in Peninsular Malaysia, which will be increased by RM1.50 per million metric British thermal units (mmBtu) for January-July 2016, is still sold below the market price, said Tenaga Nasional Bhd (TNB) chairman Tan Sri Leo Moggie.

However, under an agreement between TNB and Petroliam Nasional Bhd (Petronas), gas is supplied at RM15.20 per mmBtu for the first 1,000 million standard cu ft per day (mmscfd) compared with the liquefied natural gas (LNG) market price of RM46.041 quoted by Petronas for the period from October to December 2014.

He said under the Government’s subsidy rationalisation programme, the piped gas price would be revised gradually every six months until it reached the market price.

“However, at the moment it is still subsidised (by the government),” he told a press conference after TNB’s AGM in Kuala Lumpur on Monday.

Gas: Fueling the future of energy

December 17, 2013

Have a look at the original article, there’s a neat diagram of how gas is prepped for end users.

Dateline 2013-10-20, Borneo Post online:

As global demand for energy grows in tandem with the rapid growth of population particularly in urban areas, energy players such as the oil and gas (O&G) industry are constantly looking for ways to meet this demand by expanding its portfolio to mitigate the dependability on declining natural resources.

“For Malaysia, the foremost energy challenge lies in meeting rising demand, whilst at the same time domestic production continues to experience natural decline,” Petroliam Nasional Bhd (Petronas) chief executive officer Tan Sri Shamsul Azhar Abbas said in Petronas ‘Our Energy Future’ report.

While oil continues to be a key energy resource in Malaysia, its dwindling global supply and volatile global prices have led to the gradual focus on the rich gas resources in the nation.

Gas, according to Petronas, has the potential to be a game-changer for the energy-hungry economies of the Asia-Pacific region as the resource is geographically diffused and environmentally beneficial compared with fossil fuels.

What is GBU?

April 16, 2013

Here’s an new acronym I learnt, PETRONAS’s GBU. It’s the Gas Business Unit of PETRONAS. Those of you familiar with the GPPs (Gas Processing Plant), yup, they under the GBU.

I heard about this Unit because of a situation where information had to be obtained from them. Information could not be obtain officially directly between staff of the same business / technical rank, but the request had to be flown up to flag country, across the BUs, then back down again.

Does anyone know where the PGB resides in this organization?

I give you some information I obtain from the Internets:

Is it a coincidence that if the GBU lost a leg, it woud be the GRU?

More spark for Malaysia power sector soon

July 25, 2012

Spark, gas, hot air… recipe for an explosion. Doesn’t anyone look at the fire triangle anymore?

Dateline 2012-07-09:

Malaysia’s power sector which has been grappling with inconsistent gas supply in the first half of the year, is expected to see brighter days, now that issues are steadily being resolved.

Energy Commission chief executive officer Datuk Ahmad Fauzi Hasan said the country’s electricity demand is expected to sizzle, with annual growth ranging between three and four per cent until 2020.


Subsidy leads to gas issue

May 16, 2012

Yes, it does.

Dateline 2012-05-04:

Subsidised gas and the inflated demand it encouraged are some of the factors that led to the severe gas shortage faced by Tenaga Nasional Bhd (TNB), said International Gas Union (IGU) president Datuk Abdul Rahim Hashim.

“We started the subsidies after the Asian financial crisis, and we should not have continued doing that. We should have weaned ourselves off it and gone back to market prices after the economy picked up again.

“We have a system whereby one end is fixed (electricity tariffs), and generators are looking for the cheapest source of fuel. Gas is the cheapest of the lot, and since generators tend to use the cheapest resource available, that has pushed the system to the limit,” he told StarBiz in an interview.

Solving oil and gas subsidy problem

May 12, 2012

Ah, near election time.

Dateline 2012-05-05:

THE argument against subsidising the country’s oil and gas has been made time and again, yet the decision to do away with it remains one that no government would be glad to make in a hurry.

One need only point to the recent examples of mass riots in Nigeria and Indonesia, where thousands took to the streets after their governments removed subsidies for fuel, as evidence that no matter the logic, this is hugely unpopular.

Nonetheless, it is a situation the Government has to resolve, and soon, as demand for gas heats up in the region.

Concern over profitability of utilities following gas shortage

March 9, 2012

Dateline 2012-02-18:

As the authorities finalise their recommendations for the price of gas, analysts are concerned over the profitability of utility companies while Tenaga Nasional Bhd (TNB) is tackling its gas supply shortage.

In a report, OSK Research head of research Chris Eng said that previously, any gas price hike had been accompanied by a corresponding increase in electricity prices to compensate for the higher fuel costs.

“Do note that in Malaysia currently, all fuel costs are borne by TNB and the utility will only be able to maintain its profit margin by passing on any fuel cost increases to consumers via higher electricity prices,” he said.