KUALA LUMPUR – Shell Petroleum Dealers Association of Malaysia (SPDAM) president Datuk Wahid Bidin said a meeting between the government and Shell has resulted in a compromise over matters concerning potential rental rate hikes.
Wahid told The Vibes that SPDAM held a meeting with officials from the Domestic Trade and Consumer Affairs Ministry on September 17 over a dispute concerning petrol dealers and foreign oil companies.
He said petrol dealers currently derive their profit margins largely from the sale of their petroleum products.
“Per litre, our profit margin from petrol is 15 sen, while diesel is 10 sen,” Wahid said.
He said oil companies obtain their profit margins from selling petroleum products to the dealers.
Wahid claimed oil companies intend to garner more profits by charging dealers more for their petroleum products.
“The problem is for petrol dealers; from the 15 sen, we have to cover our operating costs. Further, with the pandemic, our costs have increased,” he added.
This is why the intervention of the government is necessary to protect petroleum dealers, said Wahid.
On September 28, Wahid said that Domestic Trade and Consumer Affairs Minister Datuk Seri Alexander Nanta Linggi had a meeting with Shell officials.
“The minister said (the ministry) can’t get involved in the matter. But, given the situation between oil companies and petroleum dealers, it has to do something.
“Further, it was said that because Keluarga Malaysia is the government’s new theme, there must be a win-win outcome for this situation,” he added.
Additionally, Wahid said that because the performance of a number of petroleum dealers is subpar, there are possibilities that their contracts with oil companies will be terminated.
However, he said, the government expressed hope to Shell that none of the dealers’ contracts will be terminated, especially given the ongoing pandemic.
“I think the move made by the ministry is good, as it took the middle ground without being biased towards one party,” Wahid added.
Recently, The Vibes had reported on concerned sentiments from Bumiputera petroleum dealers over the possibility of foreign oil companies squeezing them on rental charges.
Wahid said any hike in rental charges will affect the bottom line. – The Vibes, October 9, 2021
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