Projected aviation fuel deficit in Europe to reach 510,000 barrels per day
Global shipping data predicted that Europe would face a shortfall in jet fuel supplies during the last quarter of this year, despite turning to distant suppliers such as South Korea, which is set to raise its jet fuel exports to the continent in September to their highest level in four years.
Reuters quoted Energy Aspects, a firm specializing in global energy and commodity market information and analysis, as saying: “Europe is expected to see a jet fuel deficit in the fourth quarter estimated at 510,000 barrels per day, compared to a surplus of 18,000 barrels per day in the United States and 419,000 barrels per day in the Asia-Pacific region.”
Europe’s imports of jet fuel from countries such as Nigeria, the United States, and Canada have increased since the outbreak of the war in the Middle East more than six months ago, which disrupted supplies from the region and led to a cut of roughly half of Europe’s jet fuel imports.
Flow data indicates that South Korea became the latest major supplier of jet fuel shipments to Europe in September. Commodity data from Kpler shows that European imports of this fuel from the Asian country have reached 129,000 barrels per day since the beginning of September, the highest level since October 2022, with data from the London Stock Exchange Group showing similar volumes.
James Noel-Peswick, head of commodities at Sparta Commodities, a market information firm, said that with a continued shortage of jet fuel expected in the continent, Europe’s imports are set to persist.
Imports from South Korea also coincide with declining inventories. Independently held inventories at the Amsterdam-Rotterdam-Antwerp (ARA) oil refining and storage hub fell in the week ending September 10 to their lowest level in seven years.
Asia is a flexible supplier of jet fuel to Europe, with traders typically turning to the region when they see profitable relative price differentials between the two areas. Kpler data showed that average monthly exports reached 1.5 million barrels last year.
Government data showed that South Korea’s jet fuel production in July reached a seven-year high at approximately 13.89 million barrels, while exports hit their highest level in three and a half years.
Higher crude processing rates at refineries contributed to this production increase, and traders expect refinery crude processing utilization rates in August to be higher than in July.
