Chart of the Day: See how Singapore’s transport sector benefits from the oil rout

Both CDG and SMRT are pretty much set for the year.

Energy bills will be saved amid the sharp decline in oil and energy prices, including operators’ hedging tactics.

According to CIMB’s rough estimates, CDG could save S$30m-50m p.a. on energy bills in CY15-16 and SMRT could save S$20m-30m.

For CDG’s Singapore rail and bus operations, c.75% of the energy bill comes from diesel (bus) and c.25% from electricity (rail). For SMRT, c.70% of the energy bill comes from electricity (rail) and c.30% from diesel (bus).

CDG has historically been more active in energy price hedging than SMRT. CDG has hedged 65-70% of its FY12/15 diesel consumption and 15% of FY12/16 consumption. CDG’s electricity consumption is hedged to a lesser extent.

For SMRT, FY3/15 diesel consumption has been fully hedged and FY3/16 diesel consumption is 30% hedged.

In late 2014, SMRT entered into an electricity purchase agreement, according to which, the group will purchase electricity at a fixed favourable price (not disclosed) until Sep16.

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