Sergey Diakov
By the analysis from Energy Aspects, markets for jet fuel in Europe are becoming restricted because flows from the Middle East are experiencing interruptions.
European jet fuel supply is tightening, and the risk of shortages is rising.
As the conflict involving Iran occurs, producers in the region are sending fewer shipments. “As the Iran conflict disrupts Middle East flows, Europe is starting to feel the impact of lower imports.” On the basis of current data, imports of jet fuel into Europe are significantly lower in April and alternative supplies are not easily available.
European jet imports have already fallen sharply this month, replacement barrels are limited, and inventories are likely to keep drawing through Q2 26.
Supply Risks Identified Early
To identify risks to supply, Energy Aspects pointed to a growing lack of balance when the conflict began. And the researchers described multiple primary risks for the European market:
- Middle East jet flows to Europe would dry up
- ARA jet stocks were already drawing as east-of-Suez imports slowed
- European balances would tighten materially through Q2
In the current period, those factors are occurring because inflows are lower and participants are using existing inventories. Due to the conditions, the amount of fuel in storage will likely be lower than the typical levels for this time of year.
Our latest view is that European jet stocks could fall below the seasonal range by the end of May, keeping the market exceptionally tight and prices strong.
Market Intelligence Becomes Critical
With a limited supply and steady demand, the market is expected to be tight during the second quarter. To account for this, prices are at a high level. For participants in the market, it is necessary to have data and analysis that are frequent.
As geopolitical risks change how energy moves and how global markets determine prices, Energy Aspects states that it is vital to track data in real time. When participants use rapid analysis, they are able to manage those disruptions.
Sergey Diakov
