Public Reaction to the Oil Crisis: The Singapore Case 9789814376464

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The Institute of Southeast Asian Studies

- stabli shed a an autonomous corporation in May. 1968. the Institute of Southca~t A ian Studies is a regional research centre for scholars and other pcci ali LS conce mcxl with modern Southeast Asia. The Institute's (esearch interest i f0o.: u ~ o n the many- faceted problems of modernization and social change in Southea 1 A ia. The In titute i governed by a 24-member Board of Trustees on which are repre en tcxl the l 'niver ity of Singapore and Nanyang University, appointees from the Government, as well as representatives f(om a broad range of professional and ct tc organiza tion and groups. A ten-man Executive Committee oversees da -to-Jay o~ration ; it is ex officio chaired by the director. the Institute's chief a ademic and administrative officer .

.. Copyright subsists in this publication under the Un.i ted Kingdom Copyright Act, 1911 and the Singapore Copyright Act (Cap. 187). No per~n haJJ reproJuce a copy of this publication. or extracts therdrom. without the written permission of t..be Institute of Southeast Asian Studies. Singa pore."

Oil Discovery and Technical Change in Southeast Asia PUBLIC REACTION TO THE OIL CRISIS THE SINGAPORE CASE

by

Wong Saik Chin

FIELD REPORT SERIES NO. 9 Institute of Southeast Asian Studies Pr ice: S$ '6. 00

FOREWORD

There are probably few economic developments in Southeast Asia as interesting and so potential of change as the discovery of oil in the region and the industry which is growing up to support it. For much of the region this is an entirely new phenomena: at the same time Singapore stands at its centre and contributes to its technical, administrative and financial development. It would seem therefore appropriate and urgent that studies begin with the view of ascertaining what wo u ld be the impact of oil if discovered in large quantities? What impact would it have on uniting the region if the oil is found to lie off the coast of aeveral countries? What impact would it have on shipping, and more importantly on world politics especially if Southeast Asia begins to displace the Middle-East as a prime source of oil f o r Japan and Australia? With the discovery of o il will also come enormous economic and technical changes as it begi ns to generate a desirable and fundamental source of power. What are the implications of such developments and changes for Southeast Asian society? It was the feeling of the Institute of Southeast Asian Studies that there should be be inun diate study of such questions and issues as the foregoing. Indeed, with a generous grant from the Asia Foundation a beginning was made to this end early last year when the Institute inaugurated five pilot studies on aspects of various phenomena assoc1ated with oil discovery and technical change. The work that follows grew out of one of these pilot projects - "The Social Economic Impact of the Oil Industry in Singapore". It is a case study of public reaction to the Oil Crisis. As it turns out it is the first systematic survey of the subject, and Mrs. Wong Siak Chin can be rightfully pleased with producing a study that is not only topical but of considerable interest to both the professional community and the public at large. While wishing her and her work all the best, it is clearly understood that responsibility for facts and opinions expressed in this study rests exclusively with the author, and her interpretations d o not necessarily reflect the views or policy of ~he Institute itself or its supporters. 23 January 1975

Kernial Singh Sandhu Director

CONTENTS Page Foreword Acknowledgements 1

Introduction Part I: Part II:

Characteristics of Respondents Results of the First Interview Results of the Panel Study

Part III: Part IV:

Implications of Opinions

3

8 23 31

Appendix A:

Codebook

35

Appendix B:

Tables

78

Acknowledgements I would like to record my gratitude to Professo r Kerni a l Singh Sandhu, Director of the Institute of Sout heas t Asian Studies, for his support and encouragement of t his pro j e ct . I am very grateful to Professor Hans- Dieter Evers , fo r mer Head of the Department of Sociology, for his keen guidance in the planning of the project and Dr . Eddie Kuo , l e c tu r er in the Department of Sociology for his he l pfu l comment s on the write-up. 2 January 1975

Wong Saik Ch i n

INTRODUCTION* On 7 October 1973, a major war again broke out between the Arabs and the Israelis. As usual, the United States gave moral and military support to the Israelis and this was somewhat responsible for spoiling the Arabs' initial military success. The "oil weapon formula" which had been threatening in the background was finally used and the Arabs cut back oil production by 25% and increased crude oil prices to about US$5.10 per barrel. Total oil embargo was imposed on the United States and Holland . The Arabs hoped that all countries friendly to Israel would be forced to pressurize (formally in the United Nations or informally as personal favours) Israel to return all Arab territories taken in the 1967 and the present war. As no immediate solution to the Middle East conflict was forthcoming, the following months, November and December, saw the gradual escalation of the embargo effects. Shortage of fuel and increased prices affected transportation and heating systems. There were reports of violent encounters at petrol kiosks, strikes and demonstrations against higher petrol prices and protests against increases in the prices of commodities.! As the world became increasingly concerned about the oil embargo, interest in the general world energy situation was generated. The following was given as an indication of 2 proven world oil reserves based on the 1972 rate of production:

camtry Nigeria Indalesia Venezuela t.E t.ESR

Years 20 27 16 11 16

The artificially created shortage aroused consciousness and stimulated discussion on the world's dependence on a limited resource.

*

All incnne and prioe figures in this study are in Singapore $ unless otherwise indicated.

1

\tlole prioe increase was partly caused by producers pass.ir¥J the burden of higher transportation costs to consuners .

2 Time, 19 November 1973.

- 2 -

In Singapore, the various language media newspapers also reported on major events related to the oil crisis and occasionally carried features on the world oil situation, oil reserves and repercussions of the crisis on the world economy. The MiPPOP (Singapore) also carried articles on like topics. In addition, forum and individual speeches by the various Members of Parliament (MPs) and energy specialists were reported. The Public Utilities Board (PUB) warned, in large, bold front print, of the need to conserve. The television and radio programmes were constantly interrupted with announcements to remind people to conserve. The urgency of the oil crisis and the extensive coverage on this topic both abroad and in Singapore prompted me to inquire about the Singaporeans' knowledge of the oil situation, their interest in the topic, their opinion of and reaction to the oil situation, their perception and actual experience of the effects, and their future outlook on this problem. In addition, I carried out a panel study on opinion change. Thus a panel study involving four interviews over an eight-week period was conducted. The data collected will be analyzed in four parts. The first describes the type of respondents interviewed. The second analyzes the opinions and reactions secured in the first interview. The third tabulates events and their relationship or non-relationship to opinion change. The final part will highlight implications of the results.

- 3 -

PART I:

CHARACTERISTICS OF RESPONDENTS

The first interview was conducted between 10 and 12 January 1974. Responden ts were selected with the following criteria in mind: i ii

They should be heads of household s. There should be represent ation from different : a

Socio-eco nomic areas of Singapore ,

b

Dialect and ethnic groups,

c

Housing types.

Interview ers were directed to housing types and different "social areas" of Singapore , but much depended on their ability to get a varied group and to select only household heads for inte rviewing. An one-hundr ed-person sample was decided upon but as thi s was also a panel study and responden ts had to be inte rviewed four times, twenty more were selected for the first interview to make allowance s for drop-outs and for errors by interview ers. One hundred and two questionn aires were accepted for the final analysis. 3 Except for two ambiguous cases, the other one hundred responden ts were household heads. The frequency distribut ion (FO) of aqe groups (Table 1), income groups (Table 2) , education al groups (Table 3), language groups (Table 4) , housing types (Table 5) and occupatio nal groupings (Table 6) are shown in the following tables: Table 1:

Frequancy Distributio o of

Age

Groups FO

21-X>

31-40 41-50 50+

3 'ftwy cla.imad to be heads of households.

12 22 30

38

- 4 -

Frequency Distribution of Incane Groups

Table 2 :

Incarre of Resp::mdent

$200 $201-$400 $401-$600 $600 and more Error NA*

FD

8

21 39 27 1 9

Frequency Distribution of Educational Qualifications

Table 3:

Respondent 1 s level of Education No education Some or completed primary education Some secondary education Completed secondary education College or post-secondary training University or more Nr,ll Error

FD

5

18 18 32 10 9 10

Frequency Distribution of language GroS?S

Table 4:

Respondent 1 s Medii.IDl of Education

FD

Chinese Olinese English Malay

33 1

&

English

45 2 1 2

others

Error

*

NA

# NI

= Not = No

A~plicable.

Information or No Answer.

- 5 -

Table 5:

F!:!g\!encx Distributi a\ of Housinq

~

Type of Housir¥;

FD

Attap, zinc HIE flat Private flat Terrace, semi-detac hed BunJalOtl

4 50 20 22 10 10

9\op-house

1 4

Ibn

Others

Table 6:

Frequency Distributio n of Occupation al Groups FD

siooal, tedmical and related '.«>l:kers ldnini&tra tive, e>CeCUt.ive and managerial 't«>rkers Clerical and mlated workers Sale worlcers Craftsmen, productial -prooess workers and labourers Workers in trawport and CXJt1TUl'lication Pro~

7

~005

4

oocupation s

10

W:lrkers in aervioe, sport and recreatioo al Wox:kers not classified above Never worked (unenployed ) Pe ired

•

15 18 26 5

5

7 5

Acoo ~ to the classifica tion in the 1966 Singapore Sample Househo~d Szatt>ey, Eocnanic Research Centre, un1versi ty of Singapore, Singapore .

Most of the responde nts were above forty years of age. Th i s is quite understan dable as they \~re household heads. Most of them had received education beyond primary school. Compared ,o he nat1onal distribut ion of educated persons, the le s educated were not well represent ed in this survey.

- 6 -

The 1970 Singapore census records 25% of the population above 20 years of age as having no education, and 38% having some or primary education, whereas this study has only 6% having no education and 18 % having primary education. Their incomes were mostly above $400 a month. Again, compared to national income distribution figures, the lower income groups were not well represented. The Economic Research Centre's "Labour Force Survey" conducted from May to July 1973 records 88% of the population earning less than $500 a month and 11.8% earning above $500 a month. The difference could be due to the latter's inclusion of the lower salaries of those entering the labour market for the first time and female workers. Most of the respondents lived in flats (54%) while the other major groups lived in private houses (32%). The attap and zinc dwellers in the national population (32% as computed from the 1970 census) were not well represented, whereas there 'llas over-representatio n of Housing and Development Board (HDB) flat dwellers. This is because the status of attap and zinc d':Jell8rs normally coincides with that of the smaller HDB flat dwellers owing to large-scale resettlement of attap and zinc house dwellers. Thus there was no conscious attempt to select specifically attap and zinc house dwellers to secure lower income group representation. One third of the respondents were Chinese-educated, while the rest were educated either in English or in another non-Chinese language. Only nine were females. The proportion of the higher occupational echelons was rather large with 59% in the upper echelon jobs and 31% in the lower echelon jobs. We shall not compare them with the national statistics as the latter figures would again include females and the newly recruited labour force, whereas our sample was of older heads of households who were normally well established in their jobs. The respondents whose opinions we shall be discussing in the analysis were therefore mainly male household heads who were slightly more literate, holding higher echelon jobs and earning a little more than the average Singaporean. Most of them lived in HDB flats and less than half were Chinese-educated while the others were English-educated or had received Tamil or Malay education. GQmma figures for the age, educational level, language stream, personal income and housing types (Table 7) show a correlation range from .101 to . 471.

- 7 -

Table 7:

Zero-{)rder Correlaticn Am:ng In~nt Variables: Age, Educaticnal Level, ~e Stream, Personal Incxrce and Housing (Ganma

xl 1-qe

~ Educational level x3 I..an:Juage stream x4 Perscnal in 200,

Don't know ------- ------- ------- ------- -Error No Answer Not Applica ble

23 19 2 1 15 3

18 21

- 58 -

3rd Interview 103. Opinion on amount of oil Singapore has (Ql} Singapore has more oil than before Same amount as before Less oil than before Other answer Don't know No Answer Not Applicable

6

57 23

15 1

104. Reason as to why Singapore has less oil than before (Qla) Middle East War, Arabs decrease supply Demand increased Singapore Government's friendly relations with Israel Other Don't know No Answer Not Applicable

17 1

3

12 79

105. Opinion as to how long shortage will last (Qlb} 1 more month 2-6 months 1-2 years Long, long time Don't know No Answer Not Applicable

7 9 5 6

75

106. Knowledge of whether there has been an increase in price of petrol, kerosene, etc. (Q2} Yes, there was a price increase No, there was no price increase Don't know No Answer Not Applicable

85

11 5 1

-

59 -

107. Reason as to why there was an increa se in price of (Q2a) petrol , kerose ne, etc. Middle East War Reduce d oil supply Increa sed in price of crude oil Profit eering Inflat ion Pan1c buying forced prices up To decrea se consum ption or preven t wastag e Combi nation of reason s Don't know Error No Answer Not Applic able

4 31 17 2

7 4 4 9 1

3 5 15

108 . Ways in which increa se affect ed respon dent and family (Q2bJ Basic neces sities of life affect ed Depriv ed of enjoym ent, entert ainme nt, luxury goods Not much effect Combi nation of effect s Don't know Error No Answer Not Applic able

29 18 23

10 1 2

7 12

109. Way& in which increa se affect ed friend s and relatl. ves