Jet Fuel

Kerosene based aviation fuel, priced off crude and gasoil with no deep futures market of its own.

Overview

Jet A trades physically at premiums to gasoil in Rotterdam and Singapore, since airlines hedge with crude, gasoil, or swaps on those cracks. Demand tracks passenger and cargo traffic, and the 2020 pandemic cut jet consumption harder than any other fuel, with recovery lagging years. Refiners squeeze jet alongside diesel, and jet cracks stayed historically strong after 2022 as capacity lagged the rebound in flying. Sustainable aviation fuel made from wastes and esters trades at multiples of kerosene, with mandates in Europe and the UK building demand. Airlines typically hedge a share of forward consumption with collars on crude or gasoil.