Global aviation faces mounting pressure from jet fuel supply disruptions and soaring prices following conflict-related closures of the Strait of Hormuz. The region, which typically supplies approximately 20% of internationally traded jet fuel and provides more than half of Europe’s imports, has become inaccessible, forcing airlines and energy markets to scramble for alternative sources.
Jet fuel prices in Europe nearly doubled between late February and early April, climbing from $831 per tonne to $1838 per tonne before settling above $1500. The United Kingdom appears particularly vulnerable, with imports comprising 65% of its jet fuel needs and only four refineries remaining in operation after recent closures. Across Europe, reserves have diminished to approximately 30 days of supply, down from 37 days prior to the conflict, approaching the 23-day threshold that the International Energy Agency considers critical for airport operations.
Airlines have responded to elevated costs through multiple strategies. Many have increased ticket prices, particularly on long-haul routes where fares have risen substantially—London to Melbourne flights in June cost 76% more than the previous year. Some carriers reduced schedules, with Lufthansa removing 20,000 flights through October. However, responses vary: low-cost carriers with fuel hedging protections maintain pricing advantages, while unhedged airlines absorb full cost increases. Short-haul European flights have seen moderate price increases as carriers compete for cost-conscious travelers.
Governments are implementing measures to mitigate disruptions. UK authorities are allowing airlines greater flexibility to cancel flights at constrained airports like Heathrow without losing valuable landing slots, while exploring imports of alternative jet fuel specifications from the United States. The European Commission has designated fuel-related cancellations as exceptional circumstances, exempting airlines from passenger compensation obligations while maintaining reimbursement requirements. Both regions are evaluating temporary authorization for aircraft to carry excess fuel at cheaper airports to reduce consumption at destination hubs.
Longer-term solutions remain underdeveloped. Sustainable Aviation Fuel production, while promoted for environmental benefits, remains expensive and scarce. Scaling domestic refining capacity would require substantial investment and extended timelines. Unless the Strait of Hormuz reopens promptly or alternative supply chains expand significantly, the aviation sector anticipates continued pressure through the summer holiday period, with potential for service disruptions affecting travelers across Europe.
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