Petrol Malaysia

As usual, petrol prices at the pump have been revised for the second time in a month. I must apologise for having a huge pile of work, inevitably postponing this post. But in these uncertain times, to be laden with work is a blessing. The world economy is suffering a beating and Malaysian employers are expected to lay off workers in 2009. The official estimate is that 102 employers will cut 4,729 jobs. The Malaysian Employers Federation estimates that employers will lay off 200,000 to 400,000 workers in 2009. The Minister of Human Resources, Datuk Dr. S. Subramaniam, reports that: in January 2009, 35 employers will cut 3,111 jobs; in February 2009, three employers will cut 1,523 jobs; and in March 2009, 64 employers will cut 115 jobs. [Source: Utusan Malaysia Online, 22 Dec. 2008. 4,729 Bakal Diberhenti ] On to the petrol prices. The prices of petrol were revised on 15th December 2008. The price of RON97 petrol is now RM1.80 per litre (Ref: Bernama, 23 Dec. 2008. Malaysia To Ride ...

In a speech on crude palm oil (CPO) on 21 Nov 2008 , YB Datuk Ian Chin Kah Fui, Minister of Plantation Industries and Commodities said that: Oil palm requires only 1 hectare of land to produce 3.7 tonnes of oil per year, compared with soyabean which requires 10.2 hectares, sunflower which requires 9 hectares, and rapeseed which requires 6 hectares to produce 3.7 tonnes of oil per year.  Oil palm is able to produce oil for about 25 years after being planted, a significant advantage over its competitors. In Malaysia, crude palm oil has been one of the top earners for the agricultural sector. When petrol prices surged in 2008 to the historic high of USD$147 per barrel, crude palm oil (CPO) prices surged as well to RM4,486 per tonne in the first quarter of 2008. Malaysia and Indonesia, taken together, account for 85% of the world's production of crude palm oil. [Source: The Star (Star Biz), 11 Dec. 2008. At page B5. Huge global stock will continue to plague CPO . By Hanim Adnan. ] Sadl...

Put simply, a contango is what happens when the price of a commodity is anticipated to go up. A commodity is bought in bulk and stored for a period of time, to be resold at a profit. The cost of storing the commodity is taken into consideration in calculating the future sale price. The main thing is that the commodity must be non-perishable. If it is perishable, the commodity does not fit into the concept of contango, because it will grow stale or mature. In short, contango means stockpiling for resale (with profit). From Wikipedia :  Contango is a term used in the futures market to describe an upward sloping forward curve (as in the normal yield curve). Such a forward curve is said to be "in contango" (or sometimes "contangoed"). Formally, it is the situation where, and the amount by which, the price of a commodity for future delivery is higher than the spot price, or a far future delivery price higher than a nearer future delivery. The opposite market condition to...

The facts show that the price of petrol is dropping, and so is the price of crude oil. Some quarters say that petrol prices in the USA could reach USD$1 per gallon. [Source: AP, 5th Dec 2008. Return to $1 gas? Energy prices evaporate ] Tom Kloza , publisher of Oil Price Information Services, speculates that the price of crude oil could dip below USD$40 per barrel. [Source: Speaking of Oil blog, 4th Dec. 2008. Never say never in the oil price business ] More interestingly, Nariman Behravesh , chief economist at IHS Global Insight, was quoted saying, "Every 10 cent drop in the gasoline price is the equivalent of a USD$12 billion tax cut." [Source: CNBC, 3rd Dec. 2008. Oil Likely To Stay At $50, But Don't Celebrate Yet. via Tom Kloza's blog] The main reason that petrol prices are falling is the excess production capacity. According to Ruchir Kadakia , head analyst at Cambridge Energy Research Associates, crude oil spare capacity is currently about 5 billion barrels. He ...

December has come. And the good news is that petrol prices have fallen once again. At the petrol pumps, RON 92 and diesel are now priced at RM1.80 per litre. RON 97 is now priced at RM1.90 per litre. This however is still higher than the global price of petrol, which is about RM1.60 per litre. [Source: New Straits Times, 3rd Dec. 2008, 6th Reduction in Petrol Price ] The Government is considering either implementing a "managed float or floor price". The present reduction of 10 sen, as opposed to 15 sen, was necessary to ensure that petrol vendors could make a profit of 2 sen per litre. [Source: New Straits Times, 4th Dec. 2008,  Lower Prices: Should We Float Or Fix Minimum Fuel Prices? ] Prime Minister YAB Abdullah Ahmad Badawi was quoted by Bernama stating: "If oil price continue to slide drastically, our revenue will be affected as the percentage of income from oil is high. If our revenue dwindles, it will lead to other problems." [Source: Bernama, 2nd Dec. 2008,...