Europe’s Fuel Crisis Spreads From Diesel to Jet Fuel

Europe’s fuel market is showing signs of a broader squeeze as jet fuel supplies tighten after a separate diesel crunch that pushed prices to record highs earlier in the month. Energy Aspects told Reuters it expects Europe could face a jet fuel shortfall of about 510,000 barrels per day in the final quarter, even as the United States and the Asia-Pacific region are forecast to have modest surpluses of 18,000 bpd and 419,000 bpd respectively. Regional inventories underline the tightening conditions. Stocks at the Amsterdam-Rotterdam-Antwerp (ARA) hub fell to 454,000 tons in the week to September 10, their lowest level since 2019, Reuters reported. At the same time, South Korea has become the largest jet fuel supplier to Europe, shipping at a daily rate of roughly 129,000 barrels. The jet fuel pressure comes on top of already elevated road fuel costs across the EU: gasoline and diesel reached record prices earlier this month, and year-to-date moves show gasoline up about 29% and diesel up about 40%, according to Euronews. Energy inflation in the eurozone was reported at 14.3% in August, a contributor to broader headline inflation dynamics. Supply disruptions have compounded the situation. Saudi Arabia canceled crude cargoes scheduled for European refiners in October after Houthi attacks hit energy infrastructure, Reuters noted, a development that curtails feedstock available to refiners. Market commentators and institutions are watching refining margins: ECB officials expect diesel margins to peak next month, while Goldman Sachs warned that refiners’ efforts to increase diesel output have reduced gasoline availability, potentially creating future squeezes in other fuel products.