Stalled US-Iran talks to keep energy costs elevated into H2

Investors are also urged to focus on gas sourcing, not just headline LNG prices.

Elevated energy costs are likely to persist through at least the second half of the year, amidst stalled US-Iran talks, prolonging price pressures for businesses and consumers in Singapore, according to an analyst.

The disruption is also reshaping investor expectations, with market participants urged to reassess exposure to liquefied natural gas (LNG) supply chains rather than rely on price movements alone.

“Investors should look past the headline LNG price moves and really understand where each company’s gas actually comes from,” said Zavier Wong, Market Analyst at eToro.

The forecast comes after a second round of negotiations in Islamabad collapsed, with Washington rejecting Tehran’s proposal to reopen the Strait of Hormuz separately from nuclear discussions, leaving the waterway effectively closed despite a ceasefire.

Meanwhile, Singapore, which generates about 95% of its electricity from gas, has moved to secure spot cargoes from Australia and Mozambique to replace curtailed Middle East supply.

State buyer GasCo is also preparing to seek long-term contracts later this year.

“That pivot may be the right move, but it comes at a cost,” Wong said. “Spot cargoes from further afield are more expensive to ship and much less predictable in timing.”

The supply shock is also affecting global players such as Shell plc, whose Qatari-linked supply and Ras Laffan facility have been hit, offsetting gains from trading volatility.

According to its first-quarter 2026 update, Shell’s trading division benefited from price volatility, though concerns over reduced physical volumes have limited share price gains.

“What’s left now is the question of how long Singapore, and the region, has to manage around a chokepoint that shows no immediate signs of reopening,” Wong added.