Defence Minister Ng Eng Hen told parliament of the decision to acquire the MRTT, which is based on the civilian A330 plane.
Ng did not say how many Singapore will buy, but an industry source said in January the city-state wants to buy six MRTT aircraft in a contract worth an estimated one billion euros (USD 1.4 billion).
The Singapore air force operates a squadron of KC-135R air refuelling tankers, according to The Military Balance 2014, published by the London-based International Institute for Strategic Studies.
"The MRTT, or Airbus A330, can hold 20 percent more fuel than our current KC-135s and will extend the range of our fighters through air-to-air refuelling," he said.
"The Airbus A330 can also double up as a cargo and troop-lift aircraft to deploy troops and equipment to overseas sites further away as we have done in HADR (humanitarian and disaster relief) operations."
IHS Jane's Defence Weekly says Airbus has won orders for the MRTT from the air forces of Australia, Saudi Arabia, Britain and the United Arab Emirates.
Boeing in 2011 beat its European rival for an estimated USD 30 billion contract to replace the US Air Force's ageing fleet of KC-135 tankers with the newer KC-46 aircraft, with the first deliveries expected in 2017.
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