The recovery of aircraft fuel supply could extend for several months even if the Strait of Hormuz returns to normal operations, according to the International Air Transport Association (IATA).
Aircraft Fuel Under Pressure
Although the potential reopening of the strait would ease oil flow, the real problem lies in refining capacity. Refineries in the Middle East have experienced significant disruptions, limiting the production of aviation fuel.
In this context, Willie Walsh, IATA’s Director General, noted that the restoration of supply will not be immediate. Even with crude oil available, transforming that resource into usable fuel for aircraft will take time.
Direct Impact on Costs and Operations
Fuel represents approximately 27% of airlines’ operating expenses, making it one of the most sensitive factors for the industry. Likewise, the sustained increase in fuel prices is forcing companies to adjust their strategies.
Among the measures adopted are flight reductions, the incorporation of additional refueling stops, and the transport of fuel from origin airports. These decisions reflect the logistical pressure facing the sector.
Prices Decoupled from Oil
Traditionally, aviation fuel follows the trend of crude oil. However, in the current scenario, jet fuel prices have increased more intensely due to refining limitations.
Although crude oil has shown signs of moderation following the announcement of a ceasefire, fuel costs remain elevated, driven by refining margins and the scarcity of finished product.
Airlines Under Pressure and Markets in Reaction
Airlines have begun to reflect this situation in their operations and financial results. Despite this, markets have reacted positively to the possibility of geopolitical stabilization.
Shares of several airlines in Asia and Europe registered significant gains, driven by expectations of a sustained reopening of the Strait of Hormuz and an eventual normalization of energy supply.
A Crisis Different from the Pandemic
IATA rules out that this situation will reach the impact of the COVID-19 pandemic. Unlike that period, when air capacity was drastically reduced, current demand remains relatively solid.
However, the recovery of the balance between supply and demand will largely depend on how quickly refineries can restore their production.
Global Production Adjustments
Given this scenario, countries with refining capacity such as India and Nigeria could play a key role in offsetting part of the deficit. Likewise, major Asian exporters are expected to reactivate their shipments once crude oil flows stabilize.
Ultimately, although the reopening of the Strait of Hormuz represents an important step, the aircraft fuel market will continue to face tensions over the coming months due to structural limitations in the supply chain.
Source: Reuters
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