Singapore's businesses are feeling the pinch as electricity and gas prices soar, leaving many owners stressed and struggling to adapt. The rising costs are not just a headache for individual restaurants and shops; they are a symptom of a broader economic challenge facing the city-state. As the Middle East conflict drives up energy prices and disrupts the supply of liquefied natural gas, Singapore's businesses are feeling the heat. The impact is particularly acute for those heavily reliant on energy-intensive operations, such as restaurants and car dealerships. For instance, Jacky Wong, the third-generation owner of Kok Sen, a popular zi char institution, is worried about the escalating operational costs. He has already begun passing on price increases to customers, and is considering further hikes, as energy costs push electricity and town gas tariffs to record highs. This is not an isolated case. The Patissier cake shop in Tyrwhitt Road has also seen its electricity bill spike, from around $1,900 in March to $3,200 in May, due to wholesale electricity rates. Despite this, the shop's owner, Chow Choon Kit, has not passed on the higher costs to customers. Instead, he has optimized his baking processes to reduce oven usage and cut the number of cake flavors offered, thereby reducing fridge space and energy consumption. However, these adaptations are not without limits. Chow acknowledges that there is a point beyond which further cost-cutting is not feasible, and he may have to absorb the increased costs. The situation is not just about individual businesses. Continental car dealer Monster Motors expects a $300 to $400 jump in its monthly electricity bill, and sales have fallen by as much as 40% since the start of the Middle East conflict, due to the surge in fuel prices and the uncertain economic environment. The Association of Small and Medium Enterprises (ASME) president, Ang Yuit, notes that the increase in electricity and gas tariffs comes at a difficult time for businesses, with margins already under pressure. The situation is further complicated by the fact that many businesses are trying to adapt and save where they can, but some may ultimately have to stop taking on certain orders or close, as it is not profitable to continue. The Singapore Business Federation (SBF) expects global energy and logistics disruptions to continue to intensify cost pressures, with large companies and small and medium-sized enterprises (SMEs) alike expecting higher costs in the months ahead. The cost expectations sub-component of its Business Sentiment Index rose from 71 points in the fourth quarter of 2025 to 75.9 points in the first quarter of 2026, indicating a growing concern among businesses. The food and beverage industry, in particular, is under pressure, with a constant churn of openings and closures. Chow from The Patissier calls for more support for this sector, which is vulnerable to the current cost situation. He worries that more local establishments may go under, and it would be a pity to lose these brands, some of which have been in business for many years. Jacky Wong from Kok Sen echoes this need for support, pointing to recent moves by bread manufacturer Gardenia and home-grown brand Tiger Beer to end production in Singapore. He fears that more businesses will follow suit if costs continue to rise. In conclusion, the rising electricity and gas prices are a significant challenge for Singapore's businesses, particularly those in energy-intensive sectors. While some businesses are adapting and optimizing their operations, the broader economic impact is likely to be felt, with potential consequences for the city-state's economy and its businesses. As the situation unfolds, it will be crucial to monitor the impact on businesses and consider appropriate support measures to help them weather the storm.
