Oil price spike hits STI as travel stocks slide and palm oil producer’s rally
15/03/2026 (The Straits Times). Singapore - Rising oil prices amid the Iran conflict continued to weigh on the Singapore stock market through the week, with the Straits Times Index (STI) falling to 4,842.27 points on March 13, down 0.12 per cent from the previous week.
Aviation and hospitality were among the sectors hit by volatile oil prices, which surged above US$100 a barrel this week.
Brent crude hit US$116 a barrel on March 9 – its highest since July 2022 – as tanker movements in the Strait of Hormuz ground to a halt, severely hurting oil supply chains. Brent crude was trading at around US$99 a barrel when markets closed in Singapore on March 13.
Shares of property developer UOL fell 4.8 per cent through the week to close at $10.30, while City Developments Limited (CDL) closed at $9.03, 1.4 per cent lower. CDL Hospitality Trusts was down 1.8 per cent at 81 cents.
Shares of companies across fuel-reliant sectors like aviation weakened, with Singapore Airlines closing the week at $6.54, 1.7 per cent lower than the previous week, while ground handler SATS closed 1.1 per cent lower at $3.61.
Oil-related stocks and offshore and marine (O&M) companies displayed resilience.
After dropping in the previous week, China Aviation Oil – the largest jet fuel trader in the Asia-Pacific region – saw its share price rise this week to close 11.5 per cent higher at $2.04. OCBC Group Research upgraded its stock rating to “buy” in its note on March 9, citing its strong cash position of US$687 million (S$882 million) and potential acquisitions down the line.
O&M company Seatrium saw its share price climb through the week after losses since the end of February, closing 1.7 per cent higher at $2.37. The company announced on March 12 that it has formed a house union for its 5,000 workers across five shipyards.
Despite seeing gains midweek, ST Engineering closed the week 0.6 per cent lower at $10.88.
Higher oil prices lift demand for palm oil as a substitute
Higher oil prices have lifted the price of diesel, which is derived from crude oil as a fuel source. As diesel prices rise, biodiesel has become more attractive to produce, increasing demand for palm oil as a feedstock and driving palm oil prices higher.
Palm oil futures rose to RM4,576 a tonne on March 12, 4.6 per cent higher than the previous week.
In response, shares of some Singapore-listed palm oil producers continued to rise through the week after seeing rallies of between 13 per cent and 65 per cent over the last two weeks.
Shares of Bumitama Agri closed the week 10.6 per cent higher at $1.56, and Kencana Agri was up 23.5 per cent at 42 cents.
Wilmar International, which runs oil palm plantations as part of its business, also saw its share price rise 8.9 per cent to close the week at $3.80.
On the other hand, palm oil producer First Resources was down 2.2 per cent at $2.68.
Analysts said increased volatility in oil prices has led to biodiesel made from palm oil becoming more attractive to produce, improving profit margins for biofuel producers and potentially increasing demand for palm oil.
The Middle East crisis could further support palm oil prices through the biodiesel channel, with every US$10 per barrel increase in Brent crude potentially lifting palm oil prices by between 3 per cent and 6 per cent in the short term, according to Aletheia Capital analyst Nirgunan Tiruchelvam.
Sembcorp says no damage to UAE plant from Iranian strikes
Sembcorp Industries rebounded, ending the week 0.9 per cent higher at $5.77 after its shares had tumbled 5.7 per cent since the US-Iran war broke out on Feb 28.
Sembcorp on March 9 refuted media reports that its power and water plant in the United Arab Emirates had been damaged by Iranian strikes.
The Fujairah F1 Independent Water and Power Plant, located in the Emirate of Fujairah, is a joint venture between Sembcorp and the Abu Dhabi Water and Electricity Authority, with the Singapore group owning 40 per cent.
“Operations in all three facilities are currently continuing but as the events are evolving, Sembcorp continues to monitor the situation closely. All of Sembcorp’s employees are safe currently,” it said in a statement.
Contingency measures are in place at the facilities, and the safety and well-being of Sembcorp’s employees remain its “top priority”, as the company maintains operational stability, said the group.
Reports of possible damage to the plant first appeared in an article by international water industry publication Global Water Intelligence, and was later picked up by other media outlets.
Sembcorp added that it is able to leverage its diversified portfolio of long-term natural gas supply contracts across both piped and liquefied sources, as well as a broader portfolio of renewable energy and energy storage solutions. In particular, it said its upcoming liquefied natural gas cargo deliveries scheduled for 2026 are not from the Middle East region.
Co-living operator TAP enters migrant worker dormitory space
Co-living operator The Assembly Place (TAP) launched plans to add a migrant worker dormitory to its portfolio of co-living assets after signing a joint venture deal with dormitory operator S11 on March 11.
The announcement comes just over a month after TAP made its debut on the Catalist board of the Singapore Exchange (SGX) on Jan 23 with an $18.3 million initial public offering (IPO). It had announced its plans to enter the migrant worker living sector in its IPO press conference on Jan 12.
The new 886-bed dormitory, situated at 2 Seletar North Link, marks TAP’s entry into its sixth living sector, with its other living sectors catering to young professionals, students, foreign healthcare workers and senior residents.
It will be the first dormitory to be designed around a “community-driven concept” – also in place at TAP’s three hostels for foreign healthcare workers – the company said in a press statement.
This concept will feature structured welfare management, and residents will “benefit from regular purpose-driven programmes and activities aimed at fostering interaction, well-being and social cohesion within the community”, it added.
TAP will hold a 60 per cent stake in the new joint venture company, with S11 holding the remaining 40 per cent and full ownership of the dormitory.
TAP’s chief executive Eugene Lim said: “We believe worker housing deserves the same structured social programming, experience and comfort and governance standards as any other living asset class.”
S11’s director Johnathan Cheah added that by combining the company’s asset platform and regulatory expertise with TAP’s commercial and community management capabilities, they would be able to further improve the welfare of migrant workers living at the dormitory and raise operational excellence.
Shares of TAP briefly jumped 3.7 per cent from the previous day’s close to 28 cents when the market opened on March 11, before closing the week 1.9 per cent lower at 26.5 cents.
UI Boustead REIT closes flat after lukewarm mainboard debut
UI Boustead REIT (real estate investment trust) made a lukewarm debut on the SGX on March 12, marking the first mainboard and REIT listing of the year.
Its units commenced trading at 80.5 cents, about 8.5 per cent below its IPO price of 88 cents. The counter rose to 83.5 cents and ended the day at its opening price, with nearly 103 million shares transacted.
The REIT raised $973.6 million, the biggest REIT IPO since NTT DC REIT’s US$773 million (S$993 million) offering in July 2025. Investors included JP Morgan Asset Management, Amundi and Amova Asset Management.
Its initial portfolio comprises 23 properties valued at $1.9 billion – 21 leasehold assets in Singapore and two freehold properties in Japan.
It aims to invest in logistics, general industrial, high-spec industrial and business-space properties in the Asia-Pacific region, with a roughly 70-30 split between Singapore and Japan.
Overall portfolio occupancy is expected to rise from 89 per cent now to 93 per cent by the end of March, and to 98 per cent in a year.
What to look out for next week
Markets will continue to be volatile as the war in Iran extends into its third week.
In addition, the US Federal Reserve is set to announce its decision on interest rates on March 18.
With oil prices popping, inflation fears are on the rise and expectations for the Fed to cut rates have fallen.
Higher-for-longer rates could slow growth in the world’s largest economy as consumers and companies curb spending. It can also lead to volatility in assets like gold and stocks as the US dollar strengthens.