Source: Fortune.com
Summary
Europe is facing a severe jet fuel shortage, with inventories expected to fall below the critical 23-day threshold in June. The shortage is caused by the ongoing closure of the Strait of Hormuz amid the war in Iran. Goldman Sachs estimates that the U.K. is most at risk of jet fuel rationing. The situation is expected to worsen in July and August, with possible flight cancellations and airport closures. The airline industry is already feeling the impact, with many flights canceled and airfare prices spiking.
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The numbers tell one story. European refineries are churning out more jet fuel, but it’s not enough to meet demand. Airlines are canceling flights and hiking airfare prices. The situation is expected to worsen before it improves, even if a peace deal is reached in the Middle East. The European Commission is working with countries and airlines to manage supplies, but uncertainty persists.
As the situation unfolds, one thing is clear: the jet fuel shortage is a ticking time bomb for the airline industry.
Author: Evan Null
