Narrated ‘Umar bin Al-Khattab: The Prophet, upon whom be peace, said: “Actions are judged according to the intention behind them, and for everyone is what he intended.” (Sahih Bukhari, Volume 1, Book 1, Number 1)
The Niyya (intention) of fasting is necessary for the fast to be valid. It is not necessary to express the Niyya verbally. The Niyya in the heart will suffice. However, it is better to express the Niyya verbally also.