BN = Barang Naik! Premium Fuel RON97 Goes Up

Here comes the next increase in fuel price as dictated by the Malaysian government, little do people remember that this is only the beginning as the government is planning on an increase every 6 months until end of year 2012. The problem? Malaysia’s total subsidy for 2009 is at a staggering RM74 billion which is equivalent to RM12,900 per household. Most Malaysians know that we have a fuel subsidy, but many of us don’t know that essential items such as cooking oil, flour, sugar, education, toll, healthcare and electricity are all subsidized as well.

Do I think such reduction in subsidy is warrant? As citizens of Malaysia, we too have to play a role in helping the nation but there will be another multiple choice question: To reduce subsidies, improve the financial management level or to eliminate wastage and corruption first? If they focus only on subsidy reductions without a proper planning for the savings, I am afraid that the money may be wasted due to financial mismanagement, wastage and corruption. As a result, the people's "sacrifice" will be wasted.

The government must show a greater effort in plugging the leakage and moot out corruption, until I see this really happening I do not warrant such reduction in subsidy. After all we are just lining even more money to the pockets of the corrupted. In addition to this, we are already in the world's history books for having the highest car prices in the world due to our automotive protectionism policies. If the government is looking to reduce fuel subsidy it should also look into reducing the base price of our cars. The only parties the government is protecting are only the profit makers. Also please channel the unsubsidized money into building good public transportation.

Nevertheless, I am mixed towards fuel subsidy reduction. Sometimes, it is hard to retrieve something that you have given away. It is the same case for subsidies! People will inevitable make noise including opposition parties taking advantage of such bad news, that's the brutal truth of politics. Fuel increase has a multiplier effect on inflation as prices of goods and services will go up and this will hurt the lower income group the most. As an oil producing nation, we should be enjoying very cheap fuel so please DO NOT listen to the government when they compare it with countries like Singapore!

Countries- in Ringgit Malaysia (RM) per Litre

Malaysia 1.85

UAE 1.16
Egypt 1.02
Bahrain 0.85
Qatar 0.66
Kuwait 0.64
Saudi Arabia 0.35
Iran 0.32
Nigeria 0.30
Turkemenistan 0.23
Venezuela 0.13

Sadly Malaysia's current running deficit of ~RM400 billion means that the government cannot afford to do this or will it ever do it considering our ever growing civil service, leakages, corruption and spendthrift ways. Aboi can only provide some tips to save on gas.

1. Pump your tyres. I do this almost every time I fill up my gas. According to some just 1 tyre deflated by 2 psi will result in a 1% increase in fuel consumption.

2. Drive at moderate speed. Drag and thus fuel consumption increases rapidly at speeds above 90km/h.

3. Don't let your engine go idle. Idling more than a minute consumes much more fuel than restarting the engine.

4. Use the air-con sparingly. Air conditioners can use about 10 per cent extra fuel when operating but I will use it when it is hazy.

5. Anticipate traffic ahead. A driver can reduce fuel consumption by up to 10% by anticipating traffic conditions ahead and adjusting the speed accordingly, and avoiding tailgating and thus unnecessary braking and acceleration.

6. Travel light. Avoid carrying any unnecessary weight in your car. On the average, every 50kg added load in your car will increase fuel consumption by 2%.

7. Drive in high gear (overdrive). The engine runs most efficiently between around 1,500 and 2,500 rpm. To maintain these low revs you should change up through the gears as soon as practical and before the revs reach 2500 rpm. This can be done easily with MyVi.

 8. Clean the air-filter regularly. Clogged air filters increase fuel consumption by restricting airflow to the engine, and thus should be cleaned/replaced when necessary. Clogged air filters can increase fuel consumption by up to 10%.

9.  Park far away in parking lots. It’s easier to get head-in parking here anyway but you also save on gas because you’re not idling at the front of the store waiting for everyone else that’s up there to get out of the way. No need to go round and round in search of car park, use your legs.

10. Other ways include carpooling, filling up gas at night, take routes with less traffic lights, use car less, get a hybrid car if cash flow permits, have good motor oil, reduce air drag behind heavy vehicles but not entirely safe & the use of petrol rebate credit cards.

I used to ride roughly 320km on RON97 with RM50 (RM2.15/litre) which is 13.76km/litre. With the increase of fuel price I am anticipating only 300km. If I use RON95 which is less preferred to due knocking and under performance, it will be 340km for RM50.

I am a believer of quality and I am planning to keep my car until it is at least 10 years old so I have to preserve the engine for as long as possible. This is unless I can justify my earnings vs spending (because car is a liability not an asset). I drive about 1400km each month. A 200km setback while on RON97 means an additional RM33.33 on top of RM200. RM33*7years*6months = ~RM2970. Previously it is ~RM2200 when RON97 is still RM2.05. That is still a lot cheaper than buying a new car.

See my previous post on why RON97 beats RON95 (not cost wise)

RON95 vs RON97 My Experience

And also why I do not value car especially in Malaysia.

Do Malaysians Know How To Value Car