As one of the most crucial tank storage hubs in the world, Singapore and nowadays the greater Singapore region play a fundamental role in global trade. South East Asian countries have experienced tremendous economic growth over the past decades, and this upward trend even had an impulse after the global financial crisis in 2008. Going forward, trade imbalances, regulations and newly built capacity will continue to influence opportunities in the tank terminal
industry in the greater Singapore region.
REGIONAL DEMAND FOR OIL PRODUCTS REMAINS STRONG
Continuously growing economies have driven supply and demand for oil products in Asia, with the Indian and especially Chinese economy increasing their production substantially. China, India, Japan and South Korea are the region’s largest suppliers of oil products, with China more than doubling any other country’s output in 2017. South East Asian refinery output primarily consists of diesel and gasoline, accounting for 44% and 26% of the region’s total output in 2017 respectively. The production of both products grew rapidly over the past decade, more than any other main refinery output, while demand for both products in the region has increased gradually over the last decade.
South East Asia has surpluses of diesel, gasoline and jet-kerosene, meaning it produces more than it consumes of these products. A higher surplus generally leads to higher exports of a product, implying an increased demand for temporary tank storage capacity. Deficits exist for fuel oil, naphtha and LPG, meaning South East Asia has to import these products from outside of the region. Singapore’s tank terminal industry has been benefiting from this situation for a long time.