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A looming jet fuel shortage in Europe and Asia, driven by the Iran war and closure of the Strait of Hormuz, could upend global travel within weeks if oil doesn’t start flowing again soon \u2013 pushing up airfares and triggering flight cancellations ahead of the peak summer season.<\/p>\n
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In an interview on Thursday, International Energy Agency (IEA) Director Fatih Birol told AP that Europe has \u201cmaybe six weeks<\/a>\u201d of remaining jet fuel supplies and that the global economy faces its “largest energy<\/a> crisis\u201d.<\/p>\n In general, some European countries hold several months’ worth of jet fuel inventory at a time, according to an IEA report released this week.<\/p>\n Jet fuel \u2013 a refined kerosene-based oil product \u2013 is airlines’ biggest cost, making up about 30% of overall expenses, according to the International Air Transport Association (IATA). And jet fuel prices have roughly doubled since the war began. Shortages could start next.<\/p>\n Willie Walsh, IATA’s Director General, called the IEA\u2019s assessment of potential jet fuel shortages \u201csobering\u201d. In a statement issued on Friday, he said: \u201cWe have also estimated that by the end of May we could start to see some cancellations in Europe for lack of jet fuel. This is already happening in parts of Asia. <\/p>\n \u201cAlong with doing everything possible to secure alternative supply lines, it\u2019s important that authorities have well-communicated and well-coordinated plans in place in case rationing becomes necessary, including for slot relief.\u201d<\/p>\n Amaar Khan, head of European jet fuel pricing at Argus Media, said that with every passing day that the Strait of Hormuz remains shut, Europe is “edging closer to supply shortages\u201d. He added: \u201cThe strait accounts for around 40% of Europe\u2019s jet fuel imports, but no jet fuel has passed the strait since the war broke out.\u201d<\/p>\n Airline officials have largely reacted with caution, acknowledging potential fuel issues but working to reassure customers. Still, some carriers have already passed costs on to consumers by increasing fees for baggage and other add-ons, embedding costs into ticket prices, or raising fuel surcharges.<\/p>\n A handful of airlines<\/a> have cut flights, including Scandinavian carrier SAS<\/a> which said earlier this month that it would cancel “at least a thousand” flights in April due to surging fuel prices. <\/p>\n Experts also say that other parts of air travel \u2013 such as scheduling flexibility and routes \u2013 would likely be impacted.<\/p>\n According to a report<\/a> by Tourism Economics, following the closure of the Strait of Hormuz in March, crude oil prices have surged by 64%, marking the most significant price disruption since 2022 and affecting the aviation sector significantly. <\/p>\n \u201cThe impact on jet fuel costs has been more severe with the crack spread reaching a record $80 per barrel, doubling jet fuel prices in weeks due to tight supply of Gulf crude,\u201d wrote Stephen Rooney, Lead Economist at Tourism Economics and author of the report. \u201cAir fares are expected to rise 5% to 10%, with fuel surcharges already appearing, though weak demand will limit how much can be passed onto consumers.\u201d <\/p>\n Here’s a look at how jet fuel supplies work and how consumers might see effects.<\/p>\n How does jet fuel get to the plane?<\/p>\n Jet fuel is made from crude oil at refineries, which also create gasoline and diesel.<\/p>\n Airlines generally buy jet fuel from refineries or fuel companies, similar to drivers buying gasoline from stations, but on a much larger scale. Jet fuel travels on ships and through pipelines and is stored by airlines at airports.<\/p>\n Purchasing is handled by airlines. If fuel supplies are running out in a region, that doesn\u2019t necessarily mean there will be no flights. Some airlines might have more stored than others.<\/p>\n But remaining flights are likely to be expensive, reflecting fuel costs.<\/p>\n Larger airlines have advantages in regions with shortages. They have the financial means to deal with high prices, said Jacques Rousseau, managing director at financial firm Clearview Energy Partners.<\/p>\n In Europe, a number of countries are now relying on less than 20 days of coverage in their fuel supplies, according to this week’s IEA report. Supplies haven\u2019t dropped below 29 days since 2020, the report said.<\/p>\n If that falls under 23 days, physical shortages may emerge at some airports, resulting in flight cancellations and lower demand, the report warned.<\/p>\n Which regions could feel pain?<\/p>\n Asia-Pacific countries are the most reliant on oil and jet fuel from the Middle East, followed by Europe, Rousseau said.<\/p>\n Most of Europe\u2019s jet fuel is produced by European refiners, but about 20-25% of its supply is missing because of the war, Rousseau said.<\/p>\n To fill some gaps, the US has increased its exports of jet fuel to Europe considerably, sending about 150,000 barrels per day in April, or about six times the normal level, Rousseau said.<\/p>\n Availability of jet fuel is less of an issue in the US, a major oil producer, he added. \u201cI tell my kids\u2026 we\u2019re not so much going to run out of supply,” Rousseau said. “It\u2019s just going to cost more here, whereas in different parts of the world you could actually get to a point where there\u2019s just no fuel.\u201d<\/p>\n How much is the world supply of jet fuel lagging?<\/p>\n The world is losing 10 million to 15 million barrels of oil a day due to the closure of the Strait of Hormuz, said Pavel Molchanov, senior investment strategist at investment firm Raymond James & Associates.<\/p>\n \u201cThere are exactly the same refineries in exactly the same places in Asia and Europe, but if there is not enough oil for those refineries to operate, it\u2019s going to lead to physical supply disruption,\u201d he said.<\/p>\n Even though the IEA has released 400 million barrels of oil from members’ emergency reserves, that won’t help in the short term, he added.<\/p>\n \u201cIt could take until the end of the year to get all of those barrels onto the market,\u201d he said.<\/p>\n How will passenger travel be affected?<\/p>\n Christopher Anderson, a professor of operations, technology and information management at Cornell University, said travellers should prepare for more than just higher airfares.<\/p>\n \u201cThis is no longer just a fuel-price story. For airlines, it is now a network-planning story,\u201d he said. \u201cHigher fuel costs matter, but so do longer routings, reduced scheduling flexibility and greater uncertainty about what demand will look like even a few weeks out.\u201d<\/p>\n Travellers might see \u201ca market with later booking patterns, more schedule volatility and fewer low-fare options if this disruption lasts into the core summer season\u201d, he said.<\/p>\n Middle East travel is most severely impacted by airspace closures and rerouting costs, Rooney noted in the Tourism Economics report. \u201cAround one fifth of Europe-Asia demand and 10% of North America-Asia demand travels via Middle East and is at risk,\u201d he added. \u201cAssuming a two-month conflict, recovery is expected to begin by H2 2026, but sentiment may slow the rebound.\u201d<\/p>\n What are airlines doing?<\/p>\n Dutch airline KLM and UK budget carrier easyJet said that they weren’t experiencing current fuel shortages, without commenting further on the IEA\u2019s warning. Still, both airlines are among those that have seen higher costs eat into their budgets.<\/p>\n On Thursday, KLM said it would cut 160 flights next month \u2013 about 1% of its total European routes. The airline cited \u201crising kerosene costs\u201d and said a limited number of flights are \u201cno longer financially viable to operate\u201d.<\/p>\n In an update, easyJet said it expects to see a pretax loss of \u00a3540 million to \u00a3560 million pounds (about \u20ac619.6 million to \u20ac642.6 million) for the first half of the 2026 fiscal year. Still, CEO Kenton Jarvis said demand remains strong overall \u2013 noting that Easter travel was easyJet\u2019s busiest ever for that holiday period.<\/p>\n