What does MOF say drives the seven sen diesel increase?

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Ministry of Finance Attributes Diesel Price Increase to Global Oil Market Trends

The Ministry of Finance (MOF) has stated that the seven sen per litre increase in the retail price of diesel in Peninsular Malaysia, from RM2.74 to RM2.81 for the period of June 19 to 25, is a direct consequence of rising global oil market prices. This adjustment reflects the government's adherence to the weekly retail pricing of petroleum products, which is determined using the Automatic Pricing Mechanism (APM) formula.
Global Oil Market Influence

The MOF explicitly linked the price adjustment to the prevailing conditions in the global oil market. This indicates that fluctuations in international crude oil prices are the primary factor necessitating the change in domestic diesel pricing. The ministry's statement highlights the interconnectedness of local fuel costs with international market dynamics.
Automatic Pricing Mechanism Application

The retail prices of petroleum products, including the current diesel price in Peninsular Malaysia, are established based on the Automatic Pricing Mechanism (APM) formula. This mechanism is employed on a weekly basis to align domestic fuel prices with global market trends, ensuring a degree of responsiveness to international price movements.
Diesel Price in Peninsular Malaysia Remains Subsidised

Despite the increase, the retail price of diesel in Peninsular Malaysia remains below the fully floated price. As of June 10, 2024, the floated price stood at RM3.35 per litre, indicating that the current price of RM2.81 per litre still reflects a level of government subsidy or intervention.

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What does MOF say drives the seven sen diesel increase?

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