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Europe's Jet Fuel Market Swings To Acute Shortfall Amid Supply Disruptions, Rystad Says

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Europe's jet fuel market has shifted from structurally tight to acutely short after major supply disruptions cut flows by about one million barrels per day, Rystad Energy strategists said in a note on Thursday.

Rystad said that the closure of the Strait of Hormuz has removed about 500,000 b/d of Middle East refinery exports, while Asian refinery run cuts have reduced supply by a further 500,000 b/d.

The combined loss equals over 10% of the projected 2026 global jet demand of 8 million b/d.

Jet fuel prices in Europe are now more than double their 2025 averages, outpacing a rise of over 70% in Brent crude, while Amsterdam-Rotterdam-Antwerp hub stocks have fallen to 579,000 metric tons, their lowest level in six years, leaving about six weeks of cover.

European inventories are set to breach the critical 23-day cover threshold by June under current trends, Rystad said.

"Europe is not facing a tight market. It is facing a structural supply hole," said Susan Bell, senior vice president, Commodities, Oil at Rystad Energy.

Bell said that record US Gulf Coast exports of 110,000 b/d to Europe, alongside cargoes from West Africa, including Nigeria's Dangote refinery, are helping offset losses but cover only about half the deficit.

"A ceasefire would move futures fast, but physical jet markets will not normalize until at least 60 days after the strait reopens," she said.

Europe imports more than 30% of its jet fuel, with the Middle East typically supplying about 65% of those imports and Asia a further 22%. Both regions are now constrained.

Rystad said April inflows from the US Gulf Coast hit a record 110,000 b/d, but combined Atlantic Basin flows cover just over half of the lost Middle East supply.

Bell said even if replacement volumes improve to 75% of the deficit, stocks would still breach the 23-day threshold by August.

Meanwhile, demand destruction is offering limited relief. European jet demand is running about 150,000 b/d below 2025 levels as airlines cut unprofitable routes, with prices around $4.50 per gallon.

Lufthansa has canceled 20,000 flights, Spirit Airlines has ceased operations, and United Airlines has warned of potential ticket price increases of up to 20%.

Rystad lowered its forecast for 2026 global jet demand growth to about 200,000 b/d year over year, down from 400,000 b/d previously. Growth could turn negative if the Strait remains closed beyond mid-June.

The consultancy said if the strategic waterway reopened immediately, physical markets would need around 60 days to normalize.

Of the 300,000 b/d of jet supply lost to refinery damage, Rystad analysts said about half could recover swiftly, while Asian throughputs would ramp within 30 to 60 days of crude resuming.

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