Jet fuel demand and cost in 2019 down from last year, says EIA
Updated: Jan 2
While U.S. oil demand growth returned to positive territory in September, jet fuel and kerosene saw a 0.5% drop in demand that month, to 1.695 million barrels per day, compared to the same time last year, according to the latest monthly data from the Energy Information Administration (EIA). This drop is partially attributable, according to S&P Global, to the Boeing 737 Max airline fleet grounding, which has now hit its nine-month mark.
Europe’s September 2019 jet fuel and kerosene demand also experienced a slight drop to 863,000 barrels per day, from the same time last year. October year-over-year demand in China jumped up by 110,000 barrels per day, as passenger traffic increased more than 5.0% during the Golden Week, China’s biggest week for tourism. Compared to an almost 9% increase during the same month last year, however, this indicates a slowing in consumer spending. Some local news coverage, including China Daily, indicates that the lackluster Golden Week this year was likely related to the ongoing social unrest in Hong Kong.
As far as pricing, jet fuel in the U.S. Gulf Coast will also end the year under last year’s rates, with the average year-to-date cost at US$79.27 per barrel compared to $85.35 per barrel in 2018.
But things are not all on the decline for U.S. jet fuel, as an observation published in December’s Monthly Oil Market Report from OPEC suggested the holiday season would provide some support to jet fuel and road transport fuels. And, while this would only bring short-term relief, S&P Global Platts forecasts jet fuel demand losses will be recovered in 2020 with an estimated 140,000 barrel per day demand increase.
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