Singapore Bunker Reserves Dwindle on Hormuz Closure

Singapore, the world's largest bunker fuel refueling hub, faces dwindling reserves and surging prices due to the Iran war's closure of the Strait of Hormuz, disrupting supplies critical to global shipping since late February.

The conflict, which began on February 28, has cut off access to heavy crude oil from sources like Iraq and Kuwait, essential for producing bunker fuel. This low-grade, sludgelike petroleum product, heavier and more polluting than refined fuels used in cars and aircraft, powers vessels transporting 80 percent of globally traded goods by sea. In Singapore, prices have climbed from about 500 dollars per metric ton before the war to more than 800 dollars, or 725 dollars per U.S. ton, by early May, according to commodity analysts.

Asia, heavily reliant on Middle Eastern oil, feels the initial strain. More than half of global seaborne trade passed through Asian ports in 2024, United Nations data shows, amplifying the potential for worldwide ripple effects. Reserves in Singapore have held steady so far, but experts predict shortages ahead. "We just see the price in Singapore going up, up, up," said Natalia Katona of OilPrice.com.