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Malaysian petrol price to jump 40 percent: PM

KUALA LUMPUR, June 4, 2008 (AFP) - Malaysia said petrol prices will jump 40 percent from Thursday, as it moves to cut the spiralling cost of subsidies despite the prospect of public outrage. Prime Minister Abdullah Ahmad Badawi said the price hike could suppress economic growth and drive up inflation as high as 5.
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0 percent this year, from current levels of 3.
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0 percent in April.

"The cost of petrol and commodities has risen drastically and so subsidies have to be restructured," he told a press conference Wednesday.

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"God willing I hope Malaysians will not demonstrate over this," he said, referring to fury over earlier hikes in a country where public transport is poor and most people are reliant on their cars.

Abdullah indicated that further increases were in the pipeline as Malaysia moves to completely abandon fuel price controls that would have cost 17.
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4 billion dollars this year -- about a third of the national budget.

"We are moving towards a market price regime but it has to be step by step, we cannot do it immediately," he said.

The new pump price for petrol will be 2.70 ringgit (0.84 dollars) and 2.58 ringgit for diesel. Petrol currently costs 1.92 ringgit, among

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