A dramatic spike in global liquified natural gas (LNG) spot prices and other supply issues have sent shockwaves across Singapore’s electricity market, causing at least four power providers to exit the retail market and the city-state’s power regulator to announce pre-emptive measures to safeguard energy security.
So far there has been no disruption to local electricity supplies. But experts and analysts say the question is less about keeping the lights on and more about whether businesses and consumers will have to pay substantially more for power amid an ongoing global fuel crunch. Higher power costs would, in turn, diminish prospects for a robust post-pandemic economic recovery in the global business hub.
China, the United Kingdom and other bellwether global economies are likewise grappling with power shortages and supply disruptions linked to price volatility, which Singapore is highly exposed to as it generates 95% of its power from natural gas imported by pipeline or tankers. The city-state is also one of the few countries in Asia to fully liberalize its retail electricity market.
Gas prices have surged since the beginning of the year due to a confluence of factors ranging from rising consumption driven by recovering economic activity, increased heating needs from harsher-than-usual winter conditions and a series of unplanned global production outages. Industry watchers say it’s anyone’s guess how long current price volatility levels may last.
Read the full story at Asia Times.
Nile Bowie is a journalist and correspondent with the Asia Times covering current affairs in Singapore and Malaysia. He can be reached at nilebowie@gmail.com.
