Singapore’s DPM Gan flags SAF as strategic bet in broader push to future-proof economy

Sustainable aviation fuel (SAF) has been named as a key emerging capability in Singapore's long-term economic strategy, as the city-state looks to reinforce its role as a trusted energy hub while navigating structural shifts in global trade, technology and climate policy.

In a keynote address at the Future Economy Conference on May 13, Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong outlined the findings of Singapore's Economic Strategy Review (ESR), setting out three strategic imperatives for the next phase of the country's development. Among them, building resilience while driving competitiveness featured prominently – with low-carbon fuels, including SAF, singled out as areas where Singapore must build new capabilities.

"We must reinforce Singapore's role as a reliable energy hub even as the energy system changes over time," Gan said. "This means strengthening our role in existing energy flows, while building capabilities in emerging areas such as LNG, hydrogen, ammonia, sustainable aviation fuels and low-carbon technologies."

The speech marks the latest signal from Singapore's leadership that the fuel is no longer a niche environmental concern but a strategic industrial opportunity.

Gan's address acknowledged that the world has entered a period of structural, and not temporary, change. Geopolitical tensions, the rapid rise of AI and the low-carbon transition are reshaping costs, investments and competitiveness. For Singapore, which has thrived on connectivity, the risk is clear: without renewal, yesterday's strengths will not guarantee tomorrow's relevance.

"We cannot only defend today's strengths. We must also build tomorrow's," Gan said. "This means taking calculated bets in emerging areas where Singapore has a credible right to play. Not every bet will succeed. But if we only choose traditionally safe options, we will not break new ground or grow new industries."

Gan underscored that Singapore's resilience cannot come from turning inward. Instead, it must come from being "competitive and connected, but connected in a more trusted, reliable and diversified way." For energy, that means diversifying sources, strengthening buffers, and planning for disruptions – while simultaneously positioning Singapore as a place where low-carbon fuels are not just consumed but orchestrated, financed and traded.

The minister's remarks come amid a delay in the implementation of the Singapore SAF levy for six months, the Civil Aviation Authority of Singapore announced in late March. The move comes as soaring jet fuel prices and regional instability shift airline priorities away from decarbonization toward immediate fuel cost management.

CAAS noted that with the deferment of implementing the SAF levy for flights departing Singapore from Jan. 1, 2027, the 1% SAF target will apply from 2027, instead of 2026.

For SAF producers, traders and corporate buyers, the DPM's address reinforces that Singapore is not simply following global decarbonisation trends but actively positioning itself as a critical node in the emerging low-carbon fuels architecture. Whether that bet pays off will depend on execution, infrastructure build-out and demand creation.

"This is how Singapore stays relevant," Gan said. "By building capabilities, trust and innovation that the world values."

Platts, part of S&P Global Energy, assessed sustainable aviation fuel HEFA-SPK FOB Straits at $2,520/metric ton May 14, unchanged from May 13.

The SAF FOB Straits premium was assessed at $1,322.44/mt over Platts Jet Kero FOB Singapore forward curve (MOPs), up $51.50/mt from May 13.