JAKARTA - Gasoline prices in Singapore have started to fall after almost three weeks of continued rise due to the Iran war. The Straits Times, quoted on Friday, March 27, reported that the price drop at gas stations has occurred since March 25, but the energy market is still overshadowed by uncertainty because the conflict in the Middle East has not subsided.
This decline comes after a long spike triggered by disruptions in the Strait of Hormuz, an important global oil supply route. When global supplies are threatened, crude oil prices rise and immediately put pressure on fuel prices in Singapore.
Shell became the first operator to cut prices on March 25. 95, 98, and V-Power octane gasoline were cut by five cents each, while the price of solar did not change after a sharp rise the day before.
According to The Straits Times, the downward trend continued on March 26. Esso cut five cents for all types of gasoline. Sinopec made the same cuts for 95 and 98 octane gasoline, then cut deeper into the X-Power premium gasoline by 18 cents. Caltex also lowered gasoline prices, but instead raised the price of diesel by 20 cents. SPC also cut gasoline prices by five cents, with 95 octane gasoline priced at 3.41 Singapore dollars per liter on the evening of March 26.
Sinopec again lowered prices in the morning of March 27 by cutting five cents for 95, 98 octane gasoline, and its premium products. After the revision, the price of 95 octane gasoline at major operators is in the range of 3.42 to 3.46 Singapore dollars per liter. These prices do not include discounts, so the value paid by consumers at gas stations can be lower.
The Straits Times wrote, the weakening of gasoline prices occurred when world oil prices moved wildly following the development of the conflict. Brent had fallen below $100 per barrel on March 25 after Iran signaled that non-hostile ships could still pass through the Strait of Hormuz if they coordinated with its authorities. However, a day later, prices rose back above $100 per barrel after Iran denied formal negotiations and signaled that the ceasefire was not easy.
Gasoline prices in Singapore have previously jumped sharply since February 28, when the US and Israel attacked Iran. In mid-March, prices at gas stations even exceeded the level during the Ukrainian war in 2022. At one point, the price of 95-octane gasoline rose by almost 20 percent compared to before the war.
The impact has spread to the transportation sector. ComfortDelGro temporarily raised fares and added booking fees to help drivers cope with rising fuel costs. Meanwhile, online transportation platforms launched discounts and rebates.
Even though gasoline has started to fall, diesel has continued to rise. The price of diesel in Singapore has even surpassed 95 octane gasoline since March 12. This shows that the supply pressure has not really subsided. As long as the conflict in the Middle East is not over, energy prices remain vulnerable to fluctuations.
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