The Dimwits Petrol Gift

The chart above i.e the topmost showed the crude oil price restated in Ringgit from 2004 to current year, while the bottom chart is our petrol price for similar time frame.

 The upward trajectory of crude  oil prices from 2004 has three distinctive characters;

(a)    From 2004 to July 2006 prices move in moderation and subsequently our petrol price at the pump was increase in tandem with crude oil price.

(b)   From August 2006 to January 2007 crude prices descend while our Riggit ascend vis-à-vis the US Dollar. The strength of the ringgit caused the prices of crude in ringgit to touch the bottom by March 2007as compared to crude in US dollar was at the lowest in January 2007. Unfortunately the good fortune was not passed to the rakyat by the dimwits.

(c)    From February 2007 to  July 2008 there was a long sustaining linearly upward movement in prices and ended with a record high price of crude prices in July, before a reversal or maybe a retracement in August. Despite the expansion in prices, the petrol price was kept at bay due to the election year. After the election in March and with the dimwits lossing the 2/3  majority and, 5 states and Wilayah Perseketuan….the dimwits showed their true colors…we were hit by a 40% increase in petrol prices in July.

(d)   The fall of crude oil in late August and September gave a breathing space for the dimwits to reduce petrol price. However, the reduction is not reflective of a caring government since it was more of the dimwits political strategic maneuver …the reduction of  5.6% was done in 23^rd August before the Permatang Pauh by-election and further reduction of  3.9%  on the 25^th of this month is to appease us before Hari Raya.

The 40% hike in petrol in July has done the damage as reflected by the inflation rate which has jumped to a 27-year high of 8.5 percent in August, driven by the escalating cost of food and fuel, according to official data. Any reduction of petrol prices will not be aligned with a reduction in food prices since sellers of foodstuff are a bit sticky about price reduction.

 Graphically, the increase in crude prices and petrol prices can be clearly seen in the chart below where prices is compared  to a base of constant price of January 2004.

Crude prices have moved astronomically high in the past six months and US dollar also been moving upward from March to July. The double whammy is reported to be the works of hedge funds and also the Central banks of industrial nations (that will be another story).

The meltdown of financial industry in USA will be a big question to ponder for our economic planners. Where does the US Dollar and crude prices heading?

But anyway…..an increase in crude oil prices will increase Petronas profitability.

I just don’t trust the imbecilic dimwits to manage the subsidies and loyalties forwarded by Petronas…….”Seperti tikus baiki Labu”.