Wednesday, June 11, 2008

Petrol prices.

This afternoon I got an email from a friend who works at a petroleum company. In it was a .doc that he wrote, and asked me to publish.

I won't be putting the whole thing up (kinda long) but I would be using excerpts.

A few points he made:

Petronas is not the main price-up company. As in any free market, it's by supply and demand. If demand is high and supply is low, price of commodity goes up. Same here with oil and gas.
Well, that's true. Basic law of economics (wahahaha Mr Mohan would be so proud of me). High demand + low supply = high price, and if low demand + high supply = low price. If both supply and demand are high/high or low/low, price would be maintained. Now, about Petronas. Remember this the next time you feel like putting blame of the petrol price increase on Petronas.

Petronas is just another petroleum company. They have no say about the petrol prices in Malaysia, let alone the world. Companies do not control oil prices. Governments do. (
Government = OPEC la). And another thing. If you still want to blame petroleum companies, what about the others in Malaysia? There's Shell, Exxon-Mobil, MurphyOil. Are you that paranoid, thinking that companies with GDPs higher than some countries just wanna steal your money isit?

(On what some bloggers say:)
Take half of PETRONAS profit and give to the rakyat.

The flaw: Although PETRONAS profit is RM70b last year, most of it will go into exploration of new oil sources and in operation costs. Although the price of oil doubled from last year, the operating course tripled! From barges, vessels, drilling least triple. If we do not have the money, we canit invest in future resources. We will die a natural death. Oil industries always have to take a long term view and not a knee jerk view. From a country giving a block (piece of land or sea) for an oil company to producing the 1st oil, the simplest easier fields will take 5 yrs. others, 10-15yrs. if we stop now, we could not catch up 10 yrs from now.
Let's see. If Petronas gives half their profit, then we will get RM70 billion devided by 25,274,133 people (source), that will be RM276.96 per Malaysian, per year (assuming Petronas gets that much profit every year la). Wow. That is soooo much money. The average Malaysian family has 4 members, so that a little more than 1K per family. That can buy about 410 litres of petrol, which means full tank for about 8 cars. Wooowwwww. That will last the whole year. (Please sense my sarcasm). Oh wait. Costs for dividing the money, accurately counting the number of Malaysians in the country, sending out the money safely and so on hasn't been taken into account. So what now, about... 6.5 full tanks?

(Again, on what some sources say:)
Stop spending so much money in failed exploration, wasting our money.
Eh hello. Any and all exploration sure ada failure one la weh. If you can come up with a technique that can be even 80% ( I like the number 80) successful in finding an oil pocket worth drilling, tell me please. I will be your manager and sell your services to companies and we will both be multi billionaires.

If you then say we should just stop exploring, please go and stare at the wall and think of the consequences. Then, if 10 minutes later you still don't get it, come back here.

10 minutes d? Ok.

If such exploration stops, where are we going to get our oil from once the current oil pockets become air pockets? Hmmmmmmmmmmmm? (Iyo. Stare at the walls for 10 minutes d still cannot get. Sigh. Go take Thinking Skills classes please. Taylor's College ada. A-levels there. Please, go sign up)

If you're heading to the carpark now, planning to blow up your car to save money, stop. Yes, petrol's more expensive now, but you can cut costs here and there. No, you don't have to resort to cycling everywhere (wah imagine CNY or Hari Raya. Balancing all the goodies on one bike, cycling from one end of the Peninsula to the other... >.<).

Start walking to the news stand that's 500 metres away. Take public transportation. Work closer to home, or stay closer to work. Car pool. Switch to newer cars. Use hybrids. Service your car when it's time. Make your kid pay for his own petrol consumption (this will save you alot of money I tell you. Seriously). Don't let your car idle while you're waiting for your wife to come out of the nail saloon. Don't rev your engine to impress the hot chick walking across the road (you'll probably just irritate her anyway). Plan your trips well to avoid traffic jams and long, winding routes.

There are so many more ways to save money on petrol. Be creative, be logical.

And remember, for every ringgit you save on petrol, you save the environment too.


At 11 June, 2008 19:22 , Blogger chew said...

1. Take public transportation.
Even our minister Mr Shahrir complain about public transport in our country..

2. Work closer to home or stay closer to work.
Do we even have a choice on this one??

3. Car pool.
Easier said than done..

4. Switch to newer cars.
More money again.

5. Use hybrids.
If the government dont promote the use of hybrids by lowering the taxes, what are we suppose to do. Even stations with gas are rare.

6. Service your car when it's time.
stupid point.

7. Make your kid pay for his own petrol consumption
Another stupid point

At 11 June, 2008 19:38 , Blogger TingTitLei said...

I do understand your points but Ill have to disagree with some of them. Its good to finally read something rational in the blogosphere instead of "ZOMG PETROL PRICE HIKE DIE MSIA DIE DIE DIE".

I think some of the solutions provided in your post are kinda irrelevant and does not really apply to our country. The whole public transport thing is an epic failure in malaysia. Smelly and overcharging taxis, packed and inconvenient buses, questionable railway routes. The government says that the decreased subsidy will be distributed back to the rakyat, lets just hope theyll improve the quality of the public transpport

At 11 June, 2008 19:38 , Blogger electronicfly said...

1. I've been using it just about everyday for the past 3 years. Isn't as good as many, but it isn't that bad too. And if many more Malaysians would use public transportation, then they would get more buses, thus it'll be less crowded. (my only major complaint)

2. And why not?

3. True, easier said than done, but very possible with a little socializing.

4. Newer models tend to be more fuel efficient, and so you save gas -wise. It's a more practical choice for those driving cars more than 12 years old.

5. I was referring to more modern hybrids, ie electric-petrol cars.

6. Not so stupid, since a poorly maintained car will use more petrol, wear out tires faster and increase the probability of your car dying on you. Oh, and remember Murphy's Law.

7. Stupid, only if you don't have a social butterfly for a teenager. Trust me on this. Been there, done that. And I'm the kid.

At 12 June, 2008 13:05 , Blogger Sanjeev said...

haha, i think u took only 10% of my article :P
but thanks alot.....
kinda put some sense into ppl who are willing to read deeper/heavier blog articles instead of just
"ZOMG PETROL PRICE HIKE DIE MSIA DIE DIE DIE" from tingtitlei's comment.

At 15 June, 2008 17:33 , Blogger Nimalan D said...

Girl, I'm sure Malaysians will be happy with 6.5 full tanks of petrol for free a year. I mean, let's say thats 340 liters la k. And we say the average family has 2 cars, each needing a full tank a week.So thats 104 tanks at year at 2.70 per liter, 50 liters a tank which is RM 14 k a year on petrol. 1.1 k is a lot of money relatively isn't it. Imagine what we can do with that extra 1 plus k. And may I remind you that the government is earning a shitload of money from the 'foreign tax' on cars. Throwing in the tax they earn I'll say we're looking at about 2 k a family at least

At 19 June, 2008 23:57 , Blogger electronicfly said...

Nim: Yes, it's RM1k per family per year(already did the calculations in my post), but if you take that RM1k and deduct the increase in living costs, you'll most probably end up with a very, very negative number.

Say for example that family of four has to fork out an extra RM1 per day for each of them, so it's RM1 x four members x 365 days = RM1460 a year in additional costs.

So, every year, that family will have to find a way to make do with RM460 less, assuming they are subjected to an increase of only RM4 a day.

I agree with you on the tax on foreign cars thing tho. But then again, how will a certain car company survive then? :P


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