Authored by Tsvetana Paraskova via OilPrice.com,
Europe faces an imminent jet fuel crisis as the Iran war and Hormuz disruption cut off key Middle Eastern supplies.
Long-term refinery closures and rising import dependence have left Europe highly exposed, with limited alternatives and growing competition from Asia.
Airlines are already cutting capacity and warning of higher fares, with potential flight cancellations looming as fuel shortages intensify.
Accelerated refinery closures in the past decade and increased dependence on kerosene from the Middle East have exposed Europe’s energy supply vulnerability once again.
For years, European consumers have had to contend with last-minute strikes of ground personnel and cabin crew during peak summer travel. This year, strikes may be viewed as a minor nuisance compared to what’s coming within weeks—a jet fuel supply crisis that could ground flights and hike fares.
The war in Iran has cut most of Europe’s imports of jet fuel, while local output has been falling for nearly two decades due to dozens of refineries closing permanently or being converted to biofuel production.
The war in Iran and the closure of the Strait of Hormuz have severely constrained Europe’s jet fuel supply, while jet fuel prices have spiked to over $200 per barrel. The last imports from the Middle East on tankers that had passed Hormuz before the war began have arrived, and there is only one alternative to source jet fuel—from the United States. These supplies are not only insufficient to replace the loss of Middle Eastern jet fuel. Europe faces increasingly fierce competition from Asia for these cargoes as the crisis first hit Asia with crude supply from the Middle East collapsing, Asian refiners cutting refinery runs, and countries imposing fuel export restrictions to preserve domestic supply.
Back in 2009, nearly 100 refineries were operating in Europe. Of these, 28 refineries – more than 25% of the number of refineries and 16% of refining capacity – have been either shut or transformed since 2009,according todatafrom the European Fuel Manufacturers Association.
As refineries were closing, due to declining fuel demand in Europe and emission-reduction policies, the European dependence on imported supply has grown. The hit to supply from the Middle East caught Europe off guard regarding the security of energy supply for the second time in just four years, after natural gas deliveries from Russia crashed in 2022.
Source: ZeroHedge News
