Singapore Working With Saudi Arabia on Crude Storage to Boost Energy Security — Update

By Fabiana Negrin Ochoa and Megan Cheah

Singapore and Saudi Arabia are working to establish crude-oil storage in the Southeast Asian city-state as countries seek to secure energy supplies amid the ongoing Middle East conflict.

Like many Asian nations, Singapore relies heavily on the Middle East for fuel and has managed recent oil shocks through a combination of supply diversification and fiscal support.

In a speech Monday, Singapore's Minister for Energy, Trade and Industry, Tan See Leng, warned about the impact of the continued closure of the Strait of Hormuz--a key Middle East energy shipping route--and potential escalation following recent Houthi attacks on Saudi infrastructure.

"Energy is an existential priority," he said. "Our economic growth and quality of life depend on continued access to reliable and affordable energy."

Under the proposed arrangement with Saudi Arabia, crude would be stored on Singapore's Jurong Island from the second half of next year. The move aims to safeguard the financial hub against supply disruptions while reinforcing the resilience of Saudi Arabia's oil supply chain across Southeast Asia, the Singapore and Saudi energy ministries said.

As a first step, Singapore's Energy Market Authority and JTC Corp.--another government agency--are signing a memorandum of understanding with Saudi Arabian energy giant Saudi Aramco.

The agreement marks the latest effort by the city-state to fortify its economic defenses. Last week, Singapore renewed liquefied natural gas cooperation with QatarEnergy and signed an MOU on a joint energy taskforce with the Abu Dhabi National Oil Company.

Singapore is also strengthening energy ties with regional peers. Singapore's GasCo has signed an MOU with Thailand's PTT to explore cooperation in areas such as LNG supply optimization, Tan said.

It also refreshed an MOU with Malaysia to boost bilateral collaboration in energy.

These supply-side pressures coincide with surging electricity demand from energy-intensive sectors, like chip making and data centers.

Singapore's energy authority announced a five-year plan to expand energy infrastructure, including an about $4.15 billion investment in the power grid--an 11-fold increase over the previous five years.

Between 2026 and 2031, five new natural gas-fired power plants are scheduled to come online, boosting electricity-generation capacity by around 26%. Singapore will also increase LNG regasification capacity, as natural gas contributes around 95% of its total electricity needs.

While the city-state has avoided fuel shortages or power outages, supply chains remain vulnerable to unforeseen shocks, Singapore's energy and industry minister Tan said, pointing to a recent decision by Indonesian suppliers to curtail piped gas exports to the city-state.

"We have dealt with similar disruptions in the past without incident, because of all the measures we have invested in and built up over many years," he said. "We can keep calm and carry on."

Write to Fabiana Negrin Ochoa at fabiana.negrinochoa@wsj.com and Megan Cheah at megan.cheah@wsj.com

(END) Dow Jones Newswires

October 26, 2026 04:21 ET (08:21 GMT)