Najib cautions Putrajaya against basing Budget on oil price

Azril Annuar
Datuk Seri Najib Razak pointed out that the oil market is extremely volatile and no one can truly predict its price as it is influenced by geopolitical factors. ― Picture by Yusof Mat Isa

KUALA LUMPUR, Oct 23 ― Datuk Seri Najib Razak warned the Pakatan Harapan government against formulating Budget 2019 on the assumption that Brent crude will remain at US$70 (RM291) per barrel.

The former prime minister and finance minister pointed out that the oil market is extremely volatile and no one can truly predict its price as it is influenced by geopolitical factors.

“I would like to remind (the government) that oil prices are too volatile. No one can predict the price because it depends on geopolitical factors. So in our fragile state we should not base our budget on US$70 per barrel, because we will be trapped.

“This is my worry if we based our budget on the figure due to geopolitical factors such as the embargo on Iran, Opec, Saudi Arabia and other factors,” said Najib during the debate on the midterm review of the 11th Malaysia Plan (RMK11).

He pointed out that last year the Brent crude oil price was at US$52 per barrel.

Recently Prime Minister Tun Dr Mahathir Mohamad has said he is estimating the 2019 Budget allocation based on the average crude oil price of US$70 per barrel, although the benchmark Brent crude oil is currently closer to US$80.

Later during his speech, Pendang MP Awang Solahudin Hashim (PAS) also raised the issue of Finance Minister Lim Guan Eng mocking the Kelantan state government's inability to pay the salary for its civil servants.

“Yesterday the finance minister said that Kelantan could not pay its civil servants their salary.

“Your  honourable Pekan, as the previous finance minister with access to ministry records how many times have Kelantan been unable to pay its civil servants' salary because the current minister quoted your name.

“During your tenure, has Kelantan ever requested from the federal government to assist the state to pay the civil servants' salary minus the state's grant allocations?” asked Awang.

Najib admitted that the question caught him by surprise and he did not have the details or data with him.

“Kelantan has always been able to pay its (civil servants) salary. I didn't expect this question and I do not have the data at hand but the finance minister should have all the details and he must answer this question factually,” said Najib.

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