Why Compare Brunei To Malaysia When It Comes To Retail Fuel Prices?

I received the following WhatsApp message from my father earlier today:

The government has to stop its lies and bullshit. Everybody in the oil industry globally confirms one thing. Malaysia has the “sweetest” crude oil in the world. What this means is this, we produce the highest quality oil in the world. The best of the best. But the rakyat don’t see this. This is exported for other people in the world to use. Then Malaysia reimports low grade and low quality oil at a very cheap price for the rakyat to use. Dirty oil.

The question is this. Isn’t the beautiful sweet high grade quality oil Malaysia produces belong to the rakyat of Malaysia? Why sell it of at a higher price to other countries? The oil belongs to the rakyat of Malaysia. It should be given to the people of Malaysia first. Why import dirty and filthy oil and give the rakyat of Malaysia? Why are Malaysians treated like dogs and be given the bones when other people are given the nice flesh to eat?

Another issue is subsidy. There is no such thing of subsidy. The Government of Malaysia has been lying to Malaysians the past 20 years about subsidy. You see, what you produce, you cannot subsidise. If the government does not sell our high grade oil overseas and give it to Malaysians to use, what is there to subsidise?

This story has been going around a long time to fool the people of Malaysia, especially, the kampung people that petrol need to be subsidised. We don’t need to subsidise any petrol or fuel because Malaysia produces ample oil not only for its rakyat but also for export. So, if you produce your own oil, what is there to subsidise?

If you grow vegetables in your garden to eat, you cannot go around telling people that your vegetables are subsidised. You are growing it. You are producing it. You don’t have to buy it at all from an external source. The same with oil. We produce it. We should be using it first. This is how the Sultan of Brunei thinks. That is why he gives his rakyat very cheap fuel. Then the balance, he exports it at global prices. For him, rakyat comes first. he gives the rakyat clean and cheap oil because he cares.

Our government, terbalik. Rakyat comes last. And our oil resources are far more than Brunei. Few years ago, in the global media, Petronas struck the largest oil reserve and land in the world. Global media confirmed it was the largest oil reserve in the entire world. Then the next day, our government covered it up as mere speculation. So, in actual fact, Malaysia’s petrol company Petronas has unlimited reserves of oil for the next 50 yrs. Can we Malaysians please have the priority to get this fuel first for the rakyat cheaply?

My reply is somewhat simple:

Brunei has a population of 434,000 and produces 110,000 barrels of oil per day. Malaysia has 32 million population and produces only 659,000 barrels of oil per day. Of course Brunei can afford to produce, refine and supply to her own citizens while Malaysia becomes a net importer of processed oil.

Furthermore, Malaysia produces the Tapis crude which is sweet and light with a API gravity of 45.5 degrees and sulphur content of only 0.1 percent, making it expensive on the market.

Petronas sells the Tapis crude to get more money and purchases cheaper crude oils for consumption in Malaysia.

Between 14 August 2017 and 20 November 2017 the average value of retail petrol per liter was RM2.20 with a minimum of RM2.12 and a maximum of RM2.38. For comparison, the average price of petrol in the world for the same period was RM5.80 per liter.

As at 20 November 2017, Malaysia’s retail petrol price is 20th cheapest at USD 0.58 per liter. Among the Asian countries only Myanmar is cheaper than ours – by one US cent. Indonesia is 4 spots higher at USD 0.65.

The Brunei government does not publicise its retail petrol price and is therefore not listed. It subsidises its fuel very heavily. However, in 2008 it increased prices for foreigners to B$1.18 per liter (RM2.832 in November 2008).

If Brunei is the model for Malaysians, let it be known that last year its fiscal deficit hit 16 percent of its GDP as a result of the decline in oil prices. Its 2017 budget was slashed by USD100 million to B$5.3 billion. In 2016 it was B$5.6 billion. It was B$7.3 billion in 2014 when the slump in oil prices began.

The government has frozen new staff hires for the bureaucracy. Certain civil servants benefits such as housing, electricity and petroleum subsidies have been cut.

The grass is always greener elsewhere, until you look hard.