Jet fuel supplies are lagging: What it means for airlines and travellers

A looming jet fuel shortage across Europe and Asia, triggered by the Iran war and the effective closure of the Strait of Hormuz, could disrupt global travel within weeks if oil flows are not restored soon.

The pressure on supplies risks higher airfares and potential flight cancellations as the peak summer travel season approaches.

In an exclusive Associated Press interview, International Energy Agency (IEA) Director Fatih Birol warned Europe has “maybe six weeks” of jet fuel remaining and said the global economy is facing its “largest energy crisis”.

An IEA report this week noted that several European countries typically hold months of jet fuel inventory, but stocks are now tightening rapidly.

Jet fuel — a refined kerosene-based product — is the largest single cost for airlines, accounting for about 30% of total operating expenses, according to the International Air Transport Association.

Prices have roughly doubled since the war began, with further increases expected if supply constraints persist.

“Every passing day that the Strait of Hormuz remains shut, Europe is edging closer to supply shortages,” said Amaar Khan, head of European jet fuel pricing at Argus Media.

He added that the strait accounts for around 40% of Europe’s jet fuel imports, with flows now heavily disrupted.

Jet fuel is produced from crude oil at refineries, alongside products such as petrol and diesel.

Airlines typically purchase fuel directly from refineries or fuel suppliers, then store it at airports for operational use. It is transported via pipelines, road and shipping networks.

While supply constraints do not automatically ground flights, availability differences between airlines and regions can lead to uneven impacts.

Some carriers with larger reserves are better positioned to absorb short-term shortages, while smaller operators face tighter margins.

Asia-Pacific economies are among the most dependent on Middle Eastern oil and jet fuel, followed by Europe, analysts say.

Although most European jet fuel is refined domestically, around 20–25% of supply has been disrupted due to the conflict, according to industry estimates.

The United States has stepped in to increase exports to Europe, shipping around 150,000 barrels per day in April — roughly six times the usual level.

However, analysts say availability is less of a concern in the US due to its status as a major oil producer.

Industry estimates suggest the world is losing 10 million to 15 million barrels of oil per day due to the Strait of Hormuz disruption.

“There 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’s going to lead to physical supply disruption,” said Pavel Molchanov, senior investment strategist at Raymond James & Associates.

Even though the IEA has released 400 million barrels from emergency reserves, analysts say the impact will take time to reach markets.

“It could take until the end of the year to get all of those barrels onto the market,” Molchanov said.

Experts warn the impact may go beyond higher ticket prices.

“This is no longer just a fuel-price story. For airlines, it is now a network-planning story,” said Christopher Anderson, professor at Cornell University.

He said airlines may adjust schedules, reduce flexibility and shift routes, while travellers could face greater uncertainty and fewer low-cost fares.

Booking patterns may also change, with more last-minute purchases and increased price volatility if disruption continues into the summer peak.

Several carriers say they are monitoring the situation closely while managing rising costs.

KLM and easyJet said they are not currently experiencing fuel shortages, but both have acknowledged cost pressures.

KLM plans to cut 160 flights next month — around 1% of its European network — citing rising kerosene costs and routes that are no longer financially viable.

EasyJet expects a pretax loss of £540 million to £560 million for the first half of its 2026 fiscal year, despite strong travel demand.

Lufthansa is accelerating restructuring plans, including shutting down its feeder airline CityLine and retiring older, less fuel-efficient aircraft earlier than scheduled.

US carrier Delta Air Lines said it is monitoring the situation but does not expect near-term operational disruption, citing its refinery ownership as a buffer against volatility.

Airlines are already passing higher costs on to passengers through fare increases and additional charges.

Major US carriers — including Delta, United, American Airlines, Southwest Airlines and JetBlue — have recently raised checked baggage fees.

United Airlines chief executive Scott Kirby warned that sustained high fuel prices could add $11 billion in annual costs to the airline.

Hong Kong’s Cathay Pacific has increased fuel surcharges by around 34%, while Air India has added up to $280 in fees on certain routes.

Emirates, Lufthansa and KLM have also adjusted fares or surcharges in response to price volatility.

Analysts say the duration of the Strait of Hormuz disruption will be key in determining whether the aviation sector faces manageable cost pressure or deeper operational strain heading into the summer travel season.