Seven key takeaways from the ministerial statements on the impact of the Middle East conflict on Singapore
Singapore warns of slower growth, higher inflation stemming from the Middle East conflict, and boosts support for households and businesses.
by Vanessa Lim · CNA · JoinRead a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST Tap here to return to FAST
FAST
SINGAPORE: A surge in global energy prices triggered by the Middle East conflict is set to raise costs for households and businesses in Singapore, with the government rolling out close to S$1 billion (US$777 million) in additional support measures to cushion the impact.
The support package combines targeted assistance for those hardest hit with broad-based measures for households and businesses.
On Tuesday (Apr 7), Deputy Prime Minister Gan Kim Yong, Senior Minister of State for Finance Jeffrey Siow, and Coordinating Minister for National Security K Shanmugam delivered three ministerial statements on the fallout from the conflict.
In his speech, Mr Gan said the crisis is unlikely to be over anytime soon, stressing that Singaporeans must be prepared for its effects to persist for some time.
Recognising that the impact of the crisis will be felt by households and businesses, he said the government will do what is necessary to support them through this period.
From higher petrol and electricity prices to rising food costs, the effects are expected to broaden in the months ahead. Authorities warned that uncertainty remains high and the crisis could persist.
Here are the key takeaways:
NO NEED TO TAP FUEL RESERVES OR IMPOSE RATIONING FOR NOW
So far, Singapore continues to have access to crude oil and the country has secured crude oil supplies from alternative sources, Mr Shanmugam said in his speech.
However, Singaporeans have to pay prevailing prices, which are much higher than before, he said.
While recent steps as well as measures taken even before the crisis - such as diversifying its supply sources and investments to build its energy resilience - have helped Singapore to remain relatively stable, Mr Shanmugam said if supply disruptions increase, potential disruptions to its domestic energy and electricity supply cannot be ruled out.
However, this remains a “low-probability scenario” for now, he said, adding that the government will continue to monitor developments closely.
CONCERNS OVER FOOD INFLATION
Rising energy costs are also expected to drive up global food prices.
Singapore maintains strategic food stockpiles, which will help to mitigate the impact of any unforeseen supply disruptions, said Mr Shanmugam.
However, he urged Singaporeans to be prepared for some food supplies from some countries to become unavailable and to remain flexible in choosing alternatives.
He added that the government is also relooking at the country’s supply chains - with a view towards strengthening them.
CNA Games
Guess Word
Crack the word, one row at a time
Buzzword
Create words using the given letters
Mini Sudoku
Tiny puzzle, mighty brain teaser
Mini Crossword
Small grid, big challenge
Word Search
Spot as many words as you can
Show More
Show Less
SLOWER GROWTH EXPECTED
While economic activity held up in the first quarter of 2026, growth in the coming quarters is likely to be affected by the ongoing conflict, said Mr Gan, who is also Trade and Industry Minister.
The impact will be felt across multiple sectors, although the extent remains uncertain due to the evolving situation.
Industries ranging from manufacturing to tourism, retail, and transport are expected to face higher costs and weaker demand.
The Ministry of Trade and Industry will provide an updated gross domestic product forecast in May.
INFLATION EXPECTED TO EXCEED EARLIER PROJECTIONS
Singapore’s overall inflation for 2026 is expected to exceed earlier projections, said Mr Gan. Previously, CPI-All Items and MAS Core Inflation were forecast to come in at 1.0 to 2.0 per cent in 2026, after inflation broadly eased in 2025.
If the conflict is prolonged, higher inflation in Singapore’s source markets could further increase import prices over time.
The Monetary Authority of Singapore (MAS) will take these developments into account in its upcoming assessment of the inflation outlook, which it will release on April 14.
Businesses may face higher operating costs due to increases in fuel, raw materials, transport, and shipping, while households may see higher prices for electricity, food, transport, and daily necessities.
TARGETED HELP FOR WORKERS HIT BY FUEL PRICE SPIKES
Active platform workers and taxi drivers will receive a cash relief of S$200 from end-April, according to Mr Siow, who is also Acting Transport Minister.
The government will also provide temporary assistance to co-fund cost increases for certain essential transport services for school students, seniors, and persons with disabilities, to ensure continued operation without disruption.
These include regular transport services to primary schools, Special Education schools, disability services, and health and long-term care services.
More details will be shared at a later stage.
TAX RELIEF, ENERGY SUPPORT FOR BUSINESSES
The corporate income tax rebate for the Year of Assessment 2026 will be increased from 40 per cent to 50 per cent, said Mr Siow.
The cash grant component for eligible companies will be raised from S$1,500 to S$2,000, while the total benefits cap per company will be raised from S$30,000 to S$40,000.
Eligible companies will receive the enhanced support from end-April 2026.
To support more companies in adopting energy-efficient equipment, the Energy Efficiency Grant (EEG) base tier will be expanded to all sectors and extended to Mar 31, 2028.
MTI will provide more details on the EEG later this year.
The government is also prepared to share cost increases directly arising from higher fuel prices for critical government contracts, particularly where delays or stoppages would significantly affect the public interest.
This includes major government infrastructure projects, such as the Cross Island MRT Line, or new HDB BTO projects, said Mr Siow.
EARLIER DISBURSEMENT OF CDC VOUCHER, SUPPORT FOR HOUSEHOLDS
The latest tranche of Community Development Council (CDC) vouchers – totalling S$700.07 million and announced at Budget 2026 - will be disbursed in June instead of January 2027, said Mr Siow.
All Singaporean households will receive S$500 in CDC Vouchers, valid until Dec 31, 2027.
The Cost-of-Living special payment of between S$200 and S$400 announced at this year’s Budget will be increased by S$200 for about 2.4 million eligible Singaporeans.
Those with an assessable income of up to S$100,000 and who do not own more than one property will receive between S$400 and S$600 in cash in September.
The first tranche of U-Save rebates will be disbursed in April, and the second tranche in July. In total, eligible HDB households will receive up to S$570 in U-Save rebates in the 2026 financial year.
Sign up for our newsletters
Get our pick of top stories and thought-provoking articles in your inbox
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app