\n<\/p>\n
For now, Singapore has not tapped its fuel reserves nor implemented fuel rationing in the ongoing crisis, said Mr Shanmugam.<\/p>\n
Nevertheless, it is planning to increase its fuel reserves, in a move that he said \u201cwill be costly but we think it necessary\u201d.<\/p>\n
The country\u2019s fuel reserves comprise a mix of natural gas and diesel, owned either by the government or by power generation companies, he said.<\/p>\n
Power generation companies here also have pre-arranged contractual access to additional fuel, which suppliers are required to deliver within a set number of days upon activation, said Mr Shanmugam.<\/p>\n
\u201cWe are prepared, if necessary, to direct the power generation companies to exercise their legal rights to secure the additional fuel,\u201d he said, adding, however, that some of the additional fuel itself may be subject to supply disruption abroad.<\/p>\n
Singapore\u2019s energy and fuel resilience is part of a “deliberate long-term strategy\u201d, which includes building up its capabilities as the world\u2019s third-largest oil trading hub and sixth-largest refinery export hub over decades, said Mr Shanmugam.<\/p>\n
\u201cBecause of this, we are deeply connected to global energy flows of energy. That gives us access to diverse sources of energy and fuel supplies. So we are able to respond to disruptions more flexibly and we continue so far to have access to crude oil,\u201d he said.<\/p>\n
However, there is uncertainty over how long the global disruptions will last, he said.<\/p>\n
Mr Shanmugam said that oil prices are likely to remain high even after hostilities cease, due to damage to infrastructure in the Middle East which would take time to repair, such as large oil facilities in places like Saudi Arabia and Bahrain.<\/p>\n
Even if the Strait of Hormuz fully reopens tomorrow, global oil and gas export capacity will not return to pre-conflict levels quickly, he said.<\/p>\n
\u201cIn the longer-term, we are concerned about broader disruptions to global supply chains which can affect goods critical to Singapore\u2019s economy and essential services,\u201d said Mr Shanmugam.<\/p>\n
Singapore has secured crude oil supplies from alternative sources, but at prevailing prices which are \u201cmuch higher\u201d, he said.<\/p>\n
Singaporeans are also feeling the impact downstream through higher prices, noted Mr Shanmugam.<\/p>\n
\u201cIf the conflict is prolonged, then we have to expect much sharper increases in electricity prices,\u201d he said.<\/p>\n
Singapore remains committed to decarbonising its economy, but energy security remains the immediate global priority, with fossil fuels still part of the mix, he added.<\/p>\n
He added that Singapore will continue its role as a refining hub while improving efficiency and exploring alternative sources like nuclear energy, which requires careful study and strong technical expertise.<\/p>\n<\/div>\n