Looming Jet Fuel Shortages?

[SCM]

What’s the current situation on Jet fuel pricing? I note fuel at the car bowser has dropped in recent weeks, are airlines also getting some relief now?

It's a complicates situation because it really depends on how much each airline has hedged their fuel costs and for how far out. Virgin is in an excellent position, ironically because of their IPO, something that was thought to be an extra cost is going to be an absolute windfall for them, and expect to see more sales as they will probably aggressively try and take market share using whatever aircraft they can.

Globally, hard to know, many of the M.E. airlines will have local refineries, so they have no shortage, in fact probably a huge surplus since they can't ship it out.

Japan is importing oil from Russia, so theoretically they should be in a good position for all local airlines there.

SEA, not so much.

 

[jrfsp]

JP Morgan Sees Brent Staying in Low $100s Even if Hormuz Reopens in June - Canadian Energy News, Top Headlines, Commentaries, Features & Events - EnergyNow

(Reuters) - JP Morgan expects Brent crude to remain in the low-$100s for much of 2026, even if the Strait of Hormuz reopens in June, as accelerating inventory draws and logistical bottlenecks keep the oil market tight, the bank said in a note. JP Morgan’s revised framework assumes that the…

energynow.ca

Doesn’t bode well for fuel price

 

[Saab34]

Expect high fares l think during the upcoming peak periods in an attempt to pull back as much margin as possible.

VA has a higher share of earnings in the H1 of any FY (compared to the QF group who is closer to 50/50) so they hope it doesn’t drag on too much into the new FY. Lucky they now have low debt.

 

[Quickstatus]

each airline has hedged their fuel costs and for how far out

Im presuming they buy from the onshore wholesalers?
What does force majuere do to the hedging contracts

 

[elanshin]

Expect high fares l think during the upcoming peak periods in an attempt to pull back as much margin as possible.

VA has a higher share of earnings in the H1 of any FY (compared to the QF group who is closer to 50/50) so they hope it doesn’t drag on too much into the new FY. Lucky they now have low debt.

I dont know about that.

We've been seeing some pretty aggressive sales happening right now.

 

[MEL_Traveller]

I dont know about that.

We've been seeing some pretty aggressive sales happening right now.

No doubt the ‘Australia tax’ high fares will remain

Discussed elsewhere on AFF… QR wants $11k business class to europe from Australia, but only $4000 from Jakarta (same dates, same destination). And this is for August… so not even ‘close in’ pricing.

 

[equus]

What does force majuere do to the hedging contracts

See previous post in this thread for opinion...