Europe faces jet-fuel crunch
- European airlines including Lufthansa and SAS are cutting flights as a Strait of Hormuz disruption squeezes jet-fuel supplies, turning a Middle East energy shock into a summer travel problem. - International Energy Agency chief Fatih Birol said August jet-fuel demand in Europe is typically 40% above March, while Middle East production for Europe is now “almost zero.” - The European Union is preparing measures to redistribute fuel and find new imports because about half of its imported jet fuel normally comes through Hormuz. (bloomberg.com)
Europe’s summer flight schedule is being squeezed by a jet-fuel shortage tied to the Strait of Hormuz disruption. (cnbc.com) The immediate problem is supply, not demand: International Energy Agency chief Fatih Birol told CNBC that Europe must find alternative imports as Hormuz stays shut and August demand runs about 40% above March. (cnbc.com) Birol said Middle East refineries normally provide about 75% of Europe’s jet fuel, but production for Europe is now “almost zero.” He said Europe is trying to pull barrels from the United States and Nigeria instead. (cnbc.com) Airlines have already started trimming service. CNBC reported that Lufthansa and SAS were reducing flights, while NPR said carriers across Europe had canceled tens of thousands of flights as fuel costs jumped. (cnbc.com) (npr.org) The fuel market moved first. The International Air Transport Association data cited by CNBC showed jet-fuel prices were up 103% by the end of March from a month earlier. (cnbc.com) Europe is more exposed than the United States because it imports a larger share of aviation fuel. A draft European Commission plan seen by Bloomberg said about 40% of the bloc’s jet fuel is imported, and half of those imports come through Hormuz. (bloomberg.com) That is why Brussels is moving beyond airline warnings to fuel management. Bloomberg reported on April 20 that the European Union was preparing measures to optimize distribution among member states and source replacement supplies. (bloomberg.com) The strain has already shown up at airports. Bloomberg reported earlier this month that Bologna, Milan Linate, Treviso and Venice issued fuel-limit advisories through Notice to Airmen alerts. (bloomberg.com) Refiners are trying to cover the gap, but not fast enough. Bloomberg reported that Shell’s Rotterdam plant, Europe’s biggest refinery, is running as hard as it can to make jet fuel. (bloomberg.com) For travelers, the arithmetic is simple: fewer fuel barrels mean fewer flights, higher fares, or both. Europe’s busiest flying months are still ahead. (cnbc.com)
