Kuala Lumpur  - Malaysian Prime Minister Abdullah Ahmad Badawi has pledged not to raise the price of fuel for the rest of the year, reports said Thursday.

Abdullah said the decision was made by the Cabinet late Wednesday as the government was aware of the burden faced by Malaysians following a recent raise in petrol prices by a whopping 40 per cent, the official Bernama news agency said.

On June 4, he announced a 40-per-cent increase in gasoline prices to 2.70 ringgit per litre from 1.92 ringgit. Diesel prices were also raised by 1 ringgit to 2.50 ringgit per litre, a 67 per cent increase.

Abdullah told reporters that the government would not raise fuel prices for the remaining part of the year even if global oil prices were to soar.

Following the price increase in fuel, the cost of food and services have begun to increase despite the government warning stern action against retailers who hike up their prices.

Opposition members as well as non-governmental organisations have said they plan to hold several mass demonstrations against the price increase.

The government has said the move to raise prices was to reduce its subsidy bill of at least 45 billion ringgit (14 billion dollars) this year.

Despite the price hike, petrol remains cheaper than neighbouring Thailand and Singapore. (dpa)