USGC Jet Fuel Jumps as Europe Supply Said to Last 6 Weeks


   
Miguel E. Andujar
DTN Refined Fuels Market Reporter

   DAVENPORT, FL (DTN) -- U.S. Gulf Coast jet fuel rallied more than 2% 
Thursday (4/16) on global supply concerns after the International Energy Agency 
(IEA) warned that Europe could face a critical shortage within weeks if Middle 
East disruptions persist.

   IEA Executive Director Fatih Birol, in an interview with the Associated 
Press, said Europe had "maybe six weeks or so" of jet fuel left, if flows 
through the Strait of Hormuz are not restored. The caution heightens the 
prospect of further flight disruptions and scramble for supply in a 2026 first 
quarter already marked by stress for global carrier operations.

   U.S. Gulf Coast jet fuel prices climbed to $3.9823 gallon Thursday morning, 
up 9.41cts on the day, and more than $1.58 since the end-February outbreak of 
the Iran war, which led Tehran to curtail oil tanker movements on the Hormuz 
strait.

   Blockade of the waterway -- a transit point for roughly 20% of global oil 
flows -- have already begun to impact middle distillate markets, particularly 
jet fuel, which relies heavily on medium sour crude streams originating from 
the Middle East. Disruptions and rerouting of these flows have tightened 
availability of jet fuel globally, with the effects increasingly reflected in 
U.S. Gulf Coast pricing.

   While U.S. exports of jet fuel eased week-over-week, demand for barrels 
remains firm. Data from the U.S. Energy Information Administration, released 
Wednesday (4/15) for the week ended April 10 showed jet fuel exports at 260,000 
bpd, down from 442,000 bpd the prior week, but still 130,000 bpd above the same 
week last year.

   With Europe heavily reliant on imports, any prolonged disruption in Middle 
East supply is expected to draw additional volumes from the Atlantic Basin, 
including the U.S. Gulf Coast, keeping upward pressure on prices.




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