Jet Fuel Markets Rebalance After US, European Refineries Raise Production: IEA
Fears over jet fuel supply shortfalls ahead of the peak summer travel season have significantly eased in recent weeks, after refineries in U.S. and Europe produced record amounts of aviation fuel in response to the global supply deficit, the International Energy Agency said Wednesday.
In March, U.S. refiners increased jet fuel yields to an all-time high of 12.5% with production exceeding 2 million b/d in March, after jet fuel cracks surged to $80-100/bbl, IEA said in its monthly Oil Market Report.
The additional jet fuel supplies have been delivered overseas, as U.S. jet exports were up nearly 70% year on year since the start of April to a record high, IEA said.
Nearly half the U.S. exports in May were destined for Europe, as it sought to replace lost Middle Eastern volumes. Rising U.S. jet exports to Europe came at the expense of regular buyers such as Mexico, and Central and Southern American countries, the agency said.
European refiners also pushed jet fuel supplies significantly higher in response to the deficit. According to IEA’s estimates, Europe’s jet fuel production jumped 22% year on year to 1.3 million b/d, and output is also
expected to have increased further in April and May.
With the region’s demand at 1.5 million b/d in March, Europe’s net-import requirement fell to only 200,000 b/d, much lower than its 2025 average of 500,000 b/d.
According to the agency, Middle East supplied Europe with around 350,000 b/d of jet fuel on average, but typically as much as 420,000 b/d in the peak summer months. IEA said Middle East arrivals continued through March, helping stocks reach 54 million bbl by the end of March.
IEA said, however, Mideast cargoes have dried up since April and that European imports fell to 350,000 b/d, with the U.S. and Nigeria supplying 60% of the volume going to Europe.
“Given that jet fuel demand is rising towards its summer peak of 1.7 million b/d and that imports have yet to pick up in line with the seasonal trend in recent weeks, the surge in European output will need to be maintained over the coming months to avoid excessively tight market conditions developing,” the agency said.
Turning to refining capacity for 2027, IEA said global refiners will most likely focus to restore damaged infrastructure and recover lost output following the Mideast conflicts.
“With demand growth slowing and capital spending focused on repairs rather than expansion, 2027 may mark yet another year of constrained expansion for global refining capacity,” it said.
Still, the agency expects the global refining industry’s net crude distillation capacity to increase by 770,000 b/d to 107.2 million b/d.
The new capacity includes China’s new 300,000 b/d Huajin Petrochemical complex in the Northeast province of Liaoning, as well as expansions in India and a combined 140,000 b/d additions in the Atlantic Basin including those at Marathon Petroleum’s Garyville, La., and Chevron’s Pascagoula, Miss., refineries, IEA said.
Reporting by Frank Tang, ftang@opisnet.com; Editing by Donna Harris, dharris@opisnet.com