Cost of living in Singapore 2026: How much more are you paying due to high oil prices?

The war in the Middle East may feel a world away, but its effects are showing up much closer to home-at the petrol pump, in your grocery bill, and in just about everything that has to be shipped, flown, or made from plastic. With the Strait of Hormuz effectively shut since late February and roughly a fifth of the world's oil supply caught in the crossfire, the ripple effects have reached Singapore.

It's easy to tune out the headlines when your feed is a blur of doomscrolling, hot takes, and AI-generated nonsense. But while we keep scrolling, the rest of us are quietly footing the bill. Here's what that's actually costing you in 2026.

1. Why did oil prices increase in 2026?

About 20 per cent of the world's oil supply passes through the Strait of Hormuz, which lies in between Iran and the UAE. Since there is a blockade in the Strait as ceasefires have been breached, ships are either stuck or are turning away to avoid being attacked.

Put simply, there's a global shortage in the supply of oil. And when things-like oil-are scarce, prices rise as the demand for the precious resource still holds.

This takes us back to the basic economic law of supply and demand.

2. How high oil prices are affecting daily expenses in Singapore

This price increase in oil has spillover effects on much of our daily lives.

As a nation that imports almost all of its energy, the most immediate impact for Singaporeans would be at the petrol pump and in monthly electricity bills, as power generation in Singapore is heavily reliant on natural gas, the price of which is often indexed to oil.

Beyond individual utility costs, rising energy prices act as a "tax" on businesses; manufacturers and transport firms face higher operating costs, which are inevitably passed down to consumers through more expensive goods, services, and public transport fares.

Here's a rough guide on how your expenses are being affected:

Food prices will also be affected. Think of it this way: almost everything you eat has to travel a long way to get to your plate. When oil prices go up, it gets much more expensive for ships and trucks to move that food to Singapore.

To cover those higher transport costs, supermarkets and stalls eventually have to raise their prices, so you'll likely notice your groceries getting more expensive.

Let's take a deeper look at how each category is affected.

Petrol

Singapore's favourite RON95 petrol cost has increased by nearly 20 per cent while the cost of diesel has gone up by over 50 per cent since the start of the conflict.

If you're a frequent driver, you'll have felt the pinch.

Let's say you're a parent who shuttles your kid to school every day before heading to work and then fetching them back.

Before the conflict, filling up your 50-litre tank with RON95 at S$2.85/litre cost you about $142.50. With the recent 20 per cent price hike, that same tank now sets you back $171.00. If you go through a full tank every 2 weeks, your petrol bill just jumped from $285 to $342 per month. That's an extra $57 coming out of your pocket every month.

Ride-hailing

Prices for private hire vehicles such as Grab, Gojek, Tada, Ryde and all have not been the same since Covid-19. With the rise in fuel prices, various operators have since announced a hike in fees.

Most of these platforms say the fee increases are temporary. But hey, the war was thought to be temporary too.

Public transport

If you can't stand the high ride-hailing fees, public transport is your go-to.

As of 27 March 2026, there has been no news about fare increases from rail operators because of the Middle East conflict-whew!

But we just had a fare increase of 5 per cent on Dec 27 2025, which is about $0.09 to $0.10 more per journey.

Scenario: The daily MRT commuter

Say Sarah lives in Tanah Merah and works in Tanjong Pagar. She relies solely on the MRT to get around. If she has to go to the office 5 days a week and travels out on the weekends, her daily return MRT rides will cost about $4.04.

In a month, she could be spending up to $121.20 on public transport.

Before the December 2025 hike, this same commute cost Sarah $115.80 per month. While an extra $5.40 a month might not sound like much, you can also get a meal for that price at the hawker.

Air fares

Another mode of transport that has been affected is air fares. If you've been searching for flight tickets to Japan, be prepared to pay more than usual.

Aviation jet fuel price increased to US$150 to $200 (S$192 to $256) per barrel from $85 to $90 per barrel.

For the rest of us, this means higher air fares. Some airlines that have announced price increases include:

• Singapore Airlines and Scoot
• Cathay Pacific - 34 per cent increase
• Thai Airways - 10-15 per cent increase
• Cebu Pacific - 20-26 per cent increase

On top of this, flights departing Singapore will cost $3 to $16 more from October 2026 onwards because of a levy imposed by the government to use sustainable aviation fuel.

A quick check for a round-trip ticket to Tokyo costs over $1,000 on full-fledged carriers and $706 on Scoot, which you know that by the time you add extra for luggage, it'll be about the same as the others.

Utilities: Electricity and gas

Electricity and gas tariffs have increased between April and June 2026, and more increases are expected in the latter part of 2026. With the heat being at an all time scale of unbearable, this means your aircon usage will contribute to your electricity bill too.

This means that the average electricity bill for those living in a 4-room HDB flat will increase by $1.80, according to SP Group. In a month, the average bill for a HDB 4-room flat will be around $87.69 (from $85.89).

Gas usage varies, so it really depends on your usage and how much you cook. The average gas consumption for a four-room HDB flat is 65kWh. If you cook once a day, 5 times a week, it will cost about $15.53 per month or even less if you eat out.

3. So, how much more are you paying with all these price increases?

Based on the segments that have been affected by the ongoing conflict, here is what your total monthly outlay might look like in mid-2026:

4. Tips to reduce expenses

Beyond the usual budgeting, like following the 50/30/20 rule, eating out less, and shopping only for necessary stuff, there are other ways to reduce your expenses or get more value from your spending.

• If you're trying to save on petrol, check out our list of the best credit cards in Singapore for petrol, which can save you up to 23 per cent and get you discounts and cashback
• Get cash back when you spend on groceries too, with the best credit cards for groceries
• Frequent travellers will want to check out which credit card gives you the most bang for your buck on travel spend and overseas spending
• For electricity, you can switch to a different electricity retailer or choose between a fixed plan or discount off regulated tariff plan to get the best rate for you. Check out our detailed OEM guide on how to do that.

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This article was first published in MoneySmart.