Europe’s Jet Fuel Supply Under Pressure as Hormuz Strait Closure Bites
The escalating conflict in the Middle East, specifically the de facto closure of the Strait of Hormuz following the U.S.-Israel war on Iran, is creating a severe crisis in Europe’s jet fuel supply. This disruption is driving up prices and threatening significant economic consequences for the aviation industry and beyond.
The Strait of Hormuz: A Critical Chokepoint
The Strait of Hormuz is the world’s most important oil transit chokepoint and its closure has dramatically reduced global oil supply. According to recent estimates, the shutdown has slashed global oil supply by 8 million barrels per day (mb/d), with Gulf producers cutting output by 10 mb/d due to their inability to export crude .
Kuwait’s Role and the Impact on Europe
In recent years, Kuwait has become a major supplier of jet fuel to Europe, particularly after the commissioning of the 615,000 barrels/day Al-Zour refinery. In 2025, the EU and the U.K. Imported 9.7 million metric tons of jet fuel from Kuwait, representing 36% of the region’s total consumption . The closure of the Strait of Hormuz has effectively blocked these flows, leading to significant supply tightening.
Soaring Jet Fuel Prices
The disruption has caused jet fuel prices to surge. In Northwest Europe, the jet fuel crack – a measure of refining profit – jumped $16.98/barrel to $49.17/bbl on the first trading day following the attacks on Iran, reaching its highest level since January 2023 . Jet fuel prices have more than doubled, increasing from 640 euros/ton to 1470 euros/ton in a matter of weeks.
Search for Alternative Supplies
Europe is actively seeking alternative jet fuel sources, but options are limited. Asian markets are currently prioritizing their own needs, and export restrictions in countries like China and South Korea are further tightening supply . Attention is shifting to the Atlantic Basin, specifically the US Gulf Coast and West Africa, but logistical constraints and limited export capacity imply these sources are unlikely to fully offset the shortfall.
Impact on Airlines and the Broader Economy
Airlines are facing significant margin compression due to the increased fuel costs. Carriers are responding by raising fares and cutting capacity to mitigate the impact of the rising fuel expenses, which have increased by 55% or more . The economic risks extend beyond aviation, as higher energy costs ripple through freight, manufacturing, and consumer goods.
Diesel Market Impacts
The conflict is also significantly impacting diesel markets. Iran’s closure of the Strait of Hormuz has cut exports of distillate-rich Middle Eastern crude, jet fuel, and diesel. Diesel prices have increased by 31% since the start of the war, reaching $5/gallon in some areas .
Looking Ahead
The situation remains highly volatile and dependent on the reopening of the Strait of Hormuz or a diplomatic resolution to the conflict. The market is currently pricing in an extended disruption, and airlines are largely abandoning fuel hedging strategies. The International Energy Agency’s (IEA) release of 400 million barrels of emergency reserves is proving insufficient to offset the bottlenecks caused by the closure . Continued disruption poses a significant threat to global economic recovery.
Keep reading