Global Jet Kerosene Prices Surge in October 2024 Amid Geopolitical Tensions and Rising Demand

In October 2024, global Jet Kerosene market experienced a significant surge, largely driven by ongoing volatility in the cost of key raw materials, exacerbated by persistent geopolitical tensions with North America and Middle East being the most affected region. Additionally, consumption levels of Jet Kerosene rose markedly during this period. Seasonal travel demand and heightened airline activity contributed to a sustained uptick in consumption, compounding the impact of supply-side pressures.  However, the prices have declined in India despite of increased consumption.

In October 2024, Indian Jet Kerosene prices experienced a notable decline by 4%, despite an increase in consumption. Insights gathered from various market participants indicate that the reduction in prices was largely due to strategic adjustments made by oil companies. For the second consecutive month, these companies lowered the price of Aviation Turbine Fuel (ATF), reflecting efforts to maintain market competitiveness and respond to demand fluctuations. This decision came in the context of a slight uptick in Jet Kerosene consumption, which typically would support price stability or even price increases in normal market conditions. This demand uptick led to the second-highest level of ATF consumption on record in India, as rising domestic and international travel demand, alongside airlines expanding fleets and routes, contributed to a sharp rise in fuel requirements. The festive period, particularly Diwali falling at the end of October, further boosted passenger volumes, as high travel activity around the holiday added to the already elevated demand. According to provisional data from the Petroleum Planning and Analysis Cell (PPAC), India’s jet fuel consumption grew by approximately 9% year-over-year and 4% month-over-month, reaching 751,000 tonnes.

The North American Jet Kerosene market followed a bullish trajectory in October 2024, driven by robust demand from the downstream aviation sector. Increased travel volumes and airline activity have placed upward pressure on Jet Kerosene prices as refiners worked to meet heightened demand across the continent.

In the Middle East, Jet Kerosene prices have similarly climbed, spurred by volatile crude oil prices amid ongoing regional tensions. These geopolitical issues have strained global oil supply chains, resulting in increased production costs for refiners, who are facing higher input costs and rising energy prices. This has had a direct impact on the cost of Jet Kerosene, as these upstream challenges are passed down the supply chain. Furthermore, demand for jet fuel in the Middle East has risen significantly in recent weeks due to altered flight routes. With more aircraft diverting to avoid flying over areas such as Israel and Lebanon, additional fuel is required to cover these longer routes, adding to the region’s Jet Kerosene demand. Combined, these factors have led to a marked increase in Jet Kerosene prices across the Middle Eastern market, reflecting both the cost pressures on refiners and the uptick in operational fuel demand.

According to ChemAnalyst, it is anticipated that Jet Kerosene prices will rise in the coming months. This expected increase is likely to be driven by escalating crude oil prices, which are influenced by ongoing geopolitical tensions.