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European airports risk a ‘systemic shortage’ of jet fuel if the Strait of Hormuz is not fully reopened within three weeks. As the Financial Times and Corriere della Sera reported on Friday, Airports Council International (Aci) Europe has warned that paraffin reserves are running low and that the impact of military activities is putting a strain on supplies.
In a letter dated 9 April, sent to EU commissioners Apostolos Tzitzikostas (Transport) and Dan Jørgensen (Energy), Aci Europe director general Olivier Jankovec pointed out that the situation is more critical than initially reported, putting airlines’ schedules at risk, especially for next summer’s peak tourist season.
According to the Financial Times, around 40% of the world’s jet fuel supply passes through the Strait of Hormuz. Corriere della Sera adds an alarming detail: several European states possess strategic reserves of paraffin for only eight to ten days before having to resort to rationing.
In Italy, several airports have already resorted to this emergency measure after supply difficulties encountered by a specialised operator.
Exacerbating the situation is the fact that the truce between the US and Iran that came into effect this week has not yet brought any benefits on the price side. Traffic in the Strait of Hormuz remains tight, with some 170 million barrels still blocked in the Persian Gulf.
Jet fuel stood on Thursday at around $1,573 per tonne, more than double the pre-conflict level, a figure that threatens to weigh heavily on the entire European economy.
“The reduced connectivity that would inevitably result from a shortage of jet fuel would significantly damage the European economy, thus exacerbating the macroeconomic impact of rising oil prices,” Jankovec wrote in the missive published by Corriere (source in Italian).
The shippers’ demands: monitoring and EU collective purchases
In its letter sent on Thursday, Aci Europe asked the European Commission to consider extraordinary measures, including the possibility of EU-wide collective purchases of aviation fuel and the imposition of targeted obligations on refineries to safeguard jet fuel production against other products.
The association also calls for urgent mapping of production and availability over the next six months as there is currently no centralised monitoring.
Rising costs are already pushing carriers to cut services. The Financial Times wrote that American Delta Air Lines will cut capacity by 3.5% while companies such as Poland’s Lot and Air New Zealand are cancelling less profitable flights and raising ticket prices.
Corriere della Sera also points out how reduced connectivity would significantly damage the tourism ecosystem on which the economies of many member states depend.
The president of the International Energy Agency, which last month decided on the release of strategic oil reserves to contain the crisis, described this as the most acute energy crisis in history, with heavy repercussions also on global food security.