Jet Fuel Shortage Threatens Summer Flight Schedules and Fares

BBC Business reported Sunday that a prolonged blockage of the Strait of Hormuz has triggered a jet fuel shortage. Airlines are now cutting summer capacity and raising ticket prices as peak travel season approaches.

Prices More Than Doubled in Weeks

Jet fuel traded at roughly $831 per tonne in Europe in late February. By early April, that figure had surged past $1,838 — a rise of more than 120%. Prices have since pulled back but have held above $1,500, keeping serious pressure on airline operating budgets.

The Gulf region normally supplies around 20% of jet fuel traded globally each day. Europe is a particularly heavy buyer, sourcing more than half its imports from Gulf refineries. Eight weeks of Hormuz disruption have cut off that flow entirely, forcing buyers to scramble for alternative supplies at sharply higher cost.

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Europe’s Refining Gap Makes the Problem Worse

Europe has closed five refineries in just over two years, according to Amaar Khan, head of jet fuel pricing at Argus Media. Demand, meanwhile, has grown year on year. The UK faces the sharpest exposure. Imports cover 65% of domestic jet fuel needs, and only four refineries remain operational after two recent British closures.

Because jet fuel production depends on refining capacity rather than crude availability, the supply loss from the Gulf has pushed aviation fuel prices far higher than crude oil prices alone would suggest.

Airlines Hedge Partially but Remain Exposed

Fuel typically accounts for 25-30% of airline operating costs, the International Air Transport Association estimates. European and Asian carriers commonly use hedging tools to lock in prices in advance, but that protection is only partial. EasyJet, for example, secured 80% of its first-half fuel needs at $717 per tonne. Sourcing the remaining 20% at prevailing market rates cost the carrier roughly £25 million in March alone.

US airlines, which have largely avoided hedging in recent years, face even heavier exposure to the current spike.

Also Read: Lufthansa Group Strategy Update, Spring 2026

Carriers Pull Flights Ahead of Peak Summer Season

Several major airlines have already moved to trim their summer programs. Air France KLM, Air Canada, and SAS have each announced schedule cuts. The Lufthansa group said earlier this month it would remove 20,000 flights between now and late October. Routes that were only marginally profitable before the crisis are now loss-making, according to former Loganair chief executive Jonathan Hinkles, now CEO of Skybus. Fare increases have been sharpest on long-haul routes, particularly those previously served by Gulf carriers whose capacity has contracted most severely.

Unless additional refining output can be redirected toward Europe, or the Strait of Hormuz reopens, further cancellations and price increases appear likely before the summer peak subsides.

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