Global jet fuel demand takes-off but recovery to pre-Covid levels uncertain

Global jet fuel demand takes-off but recovery to pre-Covid levels uncertain

Major aviation hubs across the world have seen continued recovery in air travels this year but a full rebound back to pre-Covid levels could be long-drawn.

27 June, 2023
Serena Huang
Serena Huang, Head of APAC Analysis

Despite rising macro-economic challenges, global air travel demand has shown a steady recovery in the first half of this year, with revenue passenger-kilometres (RPK) reaching nearly 88% of 2019 levels, according to the International Air Transport Association (IATA). Although summer travel has picked up in recent weeks, obstacles such as staffing shortages, shifts in consumer travel patterns, and geopolitical tensions are prolonging recovery to pre-Covid levels.

Jet fuel imports rise in key aviation hubs

As a proxy to jet fuel demand recovery, we benchmark import volumes into the world’s top destination markets in 1H 2023 against previous years. France’s Le Havre, a crucial hub for distributing jet fuel to neighbouring countries via the Central European Pipeline System (CEPS), experienced a 10% year-on-year (y-o-y) increase in imports during the first half of 2023, although volumes still stand at 94% of 2019 levels. While the French refinery strikes that disrupted production in March likely boosted imports, stronger travel demand remains the primary driver of the increase. After multiple months of strong imports, arrivals in June have slowed to a multi-year low with inventories in Le Havre reportedly reaching capacity.

United States’ Los Angeles International Airport (LAX), the fifth busiest airport globally, observed a 20% y-o-y increase in passenger traffic in the first four months of the year, according to statistics from Los Angeles World Airports. The strong recovery of domestic and international flights at LAX and other regional airports lifted jet fuel imports into Los Angeles port by 7% between January-April and drew on PADD 5 inventories. This led to an open arb between South Korea and US west coast, which is likely to boost jet fuel imports in the coming weeks.

Compared to Le Havre and US west coast, Hong Kong has seen the strongest growth in jet fuel imports this year. Imports almost doubled between January-June compared to last year, directly benefiting from China’s re-opening. But despite the strong recovery, import volumes still stand at only 65% of 2019 levels, being weighed down by China’s slowing economy and geopolitical tensions. The arrival of the summer holiday season is anticipated to bring demand upsides, as airlines announce plans to add flights between mainland China and Hong Kong to meet rising travel demand.

The airline industry faces multiple obstacles to reaching full recovery

Despite the resilient recovery of air travel demand over the past two years, the industry is still confronted with challenges impeding a return to pre-Covid levels. Staffing shortages and delays in fleet deliveries are constraining flight capacity during the peak summer travel season while geopolitical tensions and slowing consumer sentiments are posing downside risks to medium-term demand, all contributing to a prolonged recovery process.


Serena Huang
Head of APAC Analysis
Serena Huang
Serena leads the APAC energy market analysis with over eight years of technical and commercial industry experience. Prior to this, she was a senior market analyst in Wood Mackenzie, taking a key role in Asia’s crude and refined products analysis, refinery benchmarking and offering thought-leading insights on the market.