LTA assessing if bus operators need more support amid energy price hike

03/06/2026 1 Views

SINGAPORE – The Land Transport Authority (LTA) is assessing if local bus operators require more support as the Iran war continues to drive a spike in oil and gas prices worldwide.

“Beyond higher market prices, we note that operators are incurring additional costs to secure their supply of diesel. We will assess if additional support is necessary to ensure that bus services are not affected,” it said in a media statement on June 2.

The service fee paid by LTA to public bus operators to run bus routes is adjusted based on market energy indices, including the price of diesel. This shields operators from the bulk of energy price fluctuations, LTA said.

SBS Transit’s diesel and electricity costs increased by more than 80 per cent in March and April compared with February, said the public transport operator’s spokeswoman Grace Wu.

SMRT, meanwhile, is closely monitoring the situation as continued volatility in global energy and oil markets could increase operating costs over time.

The public transport operator said it will continue to work closely with the Ministry of Transport and LTA to explore further measures to mitigate the impact as the situation evolves.

Tower Transit Singapore said that while fuel prices have risen significantly, its contract with LTA includes an energy indexation mechanism that “largely mitigates” the impact of price changes.

“We are monitoring the residual impact and will work with LTA to ensure long-term cost sustainability,” it added.

The Straits Times has contacted Go-Ahead Singapore for comment on the impact of the Middle East conflict on its operations.

Rising fuel prices have had an impact on transport services, Acting Transport Minister Jeffrey Siow said on March 26, in an interview on his current assessment of the impact of the Middle East conflict on the transport sector here.

The Government is keeping a close watch on the situation to assess if there is a need for it to intervene “at a later juncture”, he said.

Gas and oil prices have been volatile, following the outbreak of the US-Israeli war against Iran on Feb 28, and with Tehran’s de facto closure of the Strait of Hormuz, through which a fifth of the world’s oil and gas usually flows.

Brent crude, the global oil benchmark, has fluctuated between US$92 and US$114 a barrel in the past month, hovering around the US$95 mark on June 1, up from about US$73 on Feb 27.

In April, the Ministry of Education, Ministry of Social and Family Development, and Ministry of Health said essential bus service operators will receive temporary government funding to offset higher operating costs from elevated fuel prices.

It goes towards government-contracted or subsidised operators running regular transport services to primary schools, as well as special education schools, disability services and patients receiving long-term care and community dialysis services.

The funding covers 13 per cent of transport fare revenue and will apply to services rendered from April to June.

Rising diesel costs have also affected the sea transport sector, with several ferry operators announcing a fuel surcharge earlier in March for trips to and from Singapore.

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