Jet fuel
Overview
Jet fuel market volatility, whether from crude prices, supply issues from refining capacity, or ongoing regulation changes, is a continual risk to your bottom line.
Having a choice in fuel pricing is the best way to mitigate risk and stay on top of market changes. Argus constructs price indexation in a way that is appropriate for each market. By doing so, market participants can align their day-to-day operations, improve management of fuel costs and directly impact their net earnings.
Jet fuel makes up more than 40% of an airline’s total operating expense. The rise in importance of sustainable aviation fuel (SAF) from government mandates and self-regulations from airlines has a direct implication on these operating costs.
Argus helps the jet fuel market participants to make informed decisions and optimize their strategies with price assessments and information on deals done for conventional jet fuel and SAF, as well as the latest market-moving news, in-depth analysis, supply and demand dynamics, and price forecasts.
Latest jet fuel news
Browse the latest market moving news on the global jet fuel industry.
Trump-Panama tiff highlights rising transit cost
Trump-Panama tiff highlights rising transit cost
New York, 23 December (Argus) — US president-elect Donald Trump's threat on Saturday to reclaim the Panama Canal for the US put a spotlight on rising costs this year and additional fees planned by the Panama Canal Authority (ACP) for 2025 in the ongoing fallout of a 2023 drought in Central America. Trump claimed that the US is the "number one user" of the Panama Canal, with "over 70pc of all transits heading to, or from, US ports" on 21 December. ACP data for ships destined for or departing from the US puts this percentage at 73pc in 2023 and 75.5pc in 2024 based on total tonnage of commodities moved through the canal. "This complete ‘rip-off' of our Country will immediately stop…" Trump said. The base transit tolls at the Panama Canal have been on the rise and are largely in line with those at the Suez Canal, but Panama Canal costs can be much higher for vessel operators that compete in auctions to enter the Central American passageway. The operator of a medium range (MR) tanker traveling laden through the Panama Canal would pay $279,564.87 in transit fees, while the operator of a laden very large gas carrier (VLGC) would pay $505,268.24 without accounting for reservation costs, ACP estimates. Suez Canal fees have also been on the rise , with MR tanker at $274,001 throughout 2024, while a VLGC operator would pay $487,562. But after last year's drought caused the ACP to temporarily limit transits, ACP required shippers to book transit reservations. Shippers unable to secure reservations via pre-booking often resort to the transit slot auction, where winning bids vary wildly. Pre-booked transit slots often quickly sell out to the containership and LPG vessel owners that dominate the top spots on the ACP's client list. Auction prices for the Neopanamax locks, which have a starting bid of $100,000 and handle large vessels like VLGCs, are at about $220,000, per Argus assessments. Auction prices for the Panamax locks, which have a starting bid of $55,000 and handle vessels like MR tankers, are around $75,000. The highest Neopanamax auction price was nearly $4mn, with the highest Panamax auction price at about half that level. In December 2023, 30pc of Panamax lock tanker transits were reserved via the auction system , according to ACP. The president-elect's criticism of the ACP's handling of Panama Canal fees comes as the administrators of the waterway bounce back from a severe drought throughout 2023. Freshwater levels in the manmade Gatun Lake that helps to feed the canal have recovered because of the return of the rainy season this year, but ACP has maintained its requirement that shippers wishing to transit have reserved transit slots. Prior to the drought, ACP maintained a first-come, first-serve basis for vessels without reservations. ACP ups reservation costs, adds fees for 2025 Starting in 2025, ACP is maintaining the auction system while also increasing pre-booking costs and adding other fees. ACP will raise transit reservation fees from $41,000 to $50,000 for Panamax lock transits for "Super" category vessels, including MR tankers. Neopanamax lock transit reservation fees will climb from $80,000 to $100,000 on 1 January. ACP announced a third transit option in late 2024 for vessel operators in the form of the "Last Minute Transit Reservation" (LMTR) fee to start 1 January 2025 alongside other new fees and higher existing reservation fees. ACP set the cost of the LMTR fee at about twice the starting bid of an auction , or $100,000 for Supers and $200,000 for Neopanamax, and will likely offer the LMTR fee to vessels that fail to secure a transit slot at auction. Furthermore, vessel operators that cancel within two days of their transit will be charged a fee at 2.5 times the transit reservation fee, described by the ACP as a surcharge to the existing cancellation fee, which ranges up to 100pc of the transit reservation fee depending on how close to the transit date that an operator cancels. This means that a Super vessel that cancels within two days of its transit date will receive the 2.5 times surcharge on top of the 100pc transit reservation cancellation fee and pay a total of $175,000. A Neopanamax vessel will pay a total of $350,000. "Vessels of war" should also vie for slots: ACP Trump also suggested that the ACP was charging the US Navy, alongside US corporations, "exorbitant prices and rates of passage" and that these fees were "unfair and injudicious". In March 2024, the ACP published an update on transit slot assignments for vessels of war, auxiliary vessels and other "government-owned" vessels encouraging their operators to participate in the transit system rather than waiting for the ACP to assign them a slot. "Vessels of war, auxiliary vessels, and other government-owned vessels are encouraged to obtain a booking slot through the available booking mechanisms in order to have their transit date guaranteed and minimize the possibility of delays," the ACP said. The ACP points out that these vessels of war are entitled to "expeditious transits" based on the Treaty Concerning Permanent Neutrality and Operation of the Canal and are technically not required to obtain a reservation to be considered for transit. Panama president Jose Raul Mulino on Sunday rejected Trump's threat to retake the canal , which has been under full control of the Central American country since 1999. The canal's rates are established in a public and transparent manner, taking into account market conditions, Mulino said. "Every square meter of the Panama Canal and its adjacent area is Panama's and will continue to be," Mulino said. "The sovereignty and independence of our country are non-negotiable." By Ross Griffith Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Australia to invest $9mn in biofuel production projects
Australia to invest $9mn in biofuel production projects
Sydney, 17 December (Argus) — The federal Australian Renewable Energy Agency (Arena) has allocated A$14.1mn ($9mn) toward two studies for separate biofuel production projects. Australian refiner and marketer Ampol's proposed Brisbane Renewable Fuels project will receive A$8mn toward its A$30.2mn pre-engineering study, Arena said on 17 December, while A$6.1mn will go to grains aggregator GrainCorp's sustainable aviation fuel (SAF) Oilseed Crushing Facility pre-deployment study. Ampol's study will focus on developing more than 450mn litres/yr production capacity for SAF and renewable diesel at the company's 109,000 b/d Lytton refinery near the city of Brisbane. GrainCorp's plans for an oilseed crushing facility will produce 330,000 t/yr of canola seed oil, or about 12pc of the nation's 6.13mn t canola exports in the 12 months to 30 September, for use as SAF feedstock, Arena said. Both Ampol and GrainCorp recently entered an initial agreement with London-based fund manager IFM Investors to explore options for building a renewable fuels business. While Australia is a major exporter of feedstocks for biofuels such as canola and tallow, it imports most of its liquid fuels, with diesel and jet fuel imports averaging 520,000 b/d and 129,000 b/d respectively in the first nine months of 2024. Fellow SAF aspirant Jet Zero received A$9mn from Arena in September, bringing the total outlay from the agency's A$30mn SAF funding initiative to just over A$23mn. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US road fuel stocks highest since September
US road fuel stocks highest since September
Houston, 11 December (Argus) — US road fuel stocks last week rose to the highest since September, even as demand climbed, according to US Energy Information Administration (EIA) data. US gasoline stocks in the week ended 6 December rose to 219.7mn bl, up by 2.4pc from a week earlier and the highest inventory level since the week ended 27 September. Compared with a year earlier, gasoline stocks were down by 1.9pc.. US gasoline product supplied, a proxy for demand, rose for a third consecutive week to 8.81mn b/d, notching a 0.8pc increase on the week, but falling by 0.6pc on the year. Average US retail gasoline prices slipped by 2.6¢/USG to $3.008/USG in the week ended 9 December, the eighth-consecutive weekly drop , according to an earlier EIA report. Weekly EIA demand data is prone to sharp swings, while EIA monthly data, released with a lag, provides a more accurate picture of US demand. The four-week average of combined product supplied and exports was 9.6mn b/d, a 1.8pc decrease from the previous four-week average but up by 0.6pc from the average a year earlier. US gasoline exports last week averaged 1.04mn b/d, growing by 4.5pc from a week earlier but dipping by 8.1pc on the year. Imports fell by 9.2pc on the week to 464,000 b/d and lagged behind year earlier levels by 35pc. Diesel stocks up US ultra-low sulphur diesel (ULSD) stocks increased to 112.9mn bl, up by 3.2mn bl on the week and the highest inventory level since 20 September. ULSD stocks were up by 8.5mn bl from the same week in 2023. Distillate fuel oil product supplied, which includes ULSD and high sulphur fuel oil, rose on the week by 1.5pc to 3.45mn b/d, rebounding from the prior week's decline. Still, this was down by 8.5pc from a year earlier. The implied demand for distillate fuel oil, calculated using the four-week average of combined product supply and exports, stood at 5mn b/d last week. This was down by 1.8pc from the previous week but up by 2.9pc from a year earlier. Exports of US distillate fuel oil dropped on the week by 5.1pc to 1.47mn b/d but rose by 22pc from the same week last year. ULSD imports rose by 33pc to 154,000 b/d, the highest imports since 1 November, but decreased by 25pc from a year earlier. US jet fuel stockpiles increased to 41.9mn bl, up by 0.6pc from the previous week and up by 14pc from the same week in 2023. Increased jet fuel stocks come as US airline passenger traffic declined last week from a three-month high , falling by 0.2pc to 17.3mn passengers, according to Transportation Security Administration data. Refinery runs fall US gross refinery crude inputs dropped last week by 0.9pc to 16.9mn b/d, easing from a three-month high, but inputs were up by 2.8pc from the same week in 2023. Refinery utilization rates declined on the week by 0.9 percentage points to 92.4pc. Still, this refinery rates were up by 2.2 points compared to a year earlier. By Zach Appel and Hunter Fite EIA weekly refined products data Stocks mn bl 6-Dec 29-Nov ±% Year ago ±% Gasoline 219.7 214.6 2.4% 224.0 -1.9% Jet 41.9 41.7 0.6% 36.8 13.7% Distillate fuel 121.3 118.1 2.7% 113.5 6.9% -- ultra low-sulphur (<= 15ppm sulphur) 112.9 109.7 2.9% 104.4 8.1% Imports '000 b/d Total products 1,546 1,479 4.5% 1,976 -21.8% Gasoline 464 511 -9.2% 715 -35.1% Jet 160 75 113.3% 84 90.5% Distillate fuel 154 116 32.8% 205 -24.9% Exports '000 b/d Total products 6,906 7,542 -8.4% 6,553 5.4% Gasoline 1,039 994 4.5% 1,131 -8.1% Jet 219 381 -42.5% 183 19.7% Distillate fuel 1,471 1,550 -5.1% 1,208 21.8% Refinery usage Refinery inputs '000 b/d 16,933 17,094 -0.9% 16,476 2.8% Refinery utilisation % 92.4 93.3 -1.0% 90.2 2.4% Products supplied '000 b/d Total products 20,158 19,968 1.0% 21,079 -4.4% Gasoline 8,810 8,738 0.8% 8,859 -0.6% Jet 1,841 1,610 14.3% 1,871 -1.6% Distillate fuel 3,450 3,398 1.5% 3,770 -8.5% — US Energy Information Administration Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Singapore light distillate stocks hit seven-week high
Singapore light distillate stocks hit seven-week high
Singapore, 22 November (Argus) — Singapore light distillate and middle distillate inventories rose to multi-week highs while residual fuel stocks fell to a three-week low for the week ending 20 November, according to Enterprise Singapore. Singapore's light distillates stocks rose to a seven-week high, boosted by increased naphtha imports and an onslaught of gasoline cargoes from Saudi Arabia into the city-state. Naphtha imports rose by 21pc on the week to 1.98mn bl. Kuwait, India, and the UAE were the top three suppliers to Singapore this week. Kuwait likely exported more naphtha to Asia this month, as an issue at its reformer resulted in more spare naphtha on hand for exports. More Saudi Arabian gasoline cargoes entered Singapore, adding to stocks. Singapore received another 800,000 bl of gasoline from the Mideast Gulf nation after already receiving similar volumes last week. Middle distillates stocks rose further to a six-week high, as jet fuel exports fell while imports rose. Swing supplies of jet fuel continued to arrive from India, with a 494,000 bl India jet fuel cargo imported into Singapore in the past week. Singapore's onshore fuel oil inventories retreated to a three-week low after climbing for two consecutive weeks, as imports fell sharply this week. But total inventories for November remained marginally higher at 17.78 mn bl,compared to 17.55 mn bl last month. Brazil, Indonesia, and Iraq were the top origin countries for fuel oil arrivals, while the majority of exports were bound for the Philippines and Hong Kong. No exports were recorded to China this week. By Aldric Chew, Asill Bardh, Cara Wong and Lu Yawen Singapore onshore stocks (week to 20 November '24) (mn bl) Volume ± w-o-w ± w-o-w (%) Light distillates Stocks 15.16 1.04 7.37 Naphtha imports 1.98 0.35 21.36 Naphtha exports 0.61 0.60 8,689.57 Gasoline imports 3.04 -0.53 -14.91 Gasoline exports 4.74 -0.35 -6.91 Middle distillates Stocks 10.27 0.63 6.56 Gasoil imports 0.61 -1.12 -64.79 Gasoil exports 3.48 1.36 63.82 Jet fuel imports 0.5 0.1 39.34 Jet fuel exports 0.20 -0.28 -58.34 Residual fuels Stocks 16.98 -1.37 -7.45 Fuel oil imports 2.19 -4.36 -66.61 Fuel oil exports 1.23 -2.04 -62.53 Source: Enterprise Singapore Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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