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Global Jet Fuel Demand Facing Macro Headwinds: Reuters

OIL PRODUCTS

Global jet fuel demand is poised to soften amid a slowdown in consumer spending, Reuters said.

  • Jet fuel is 7% of global oil demand and was expected to a key driver for 2024 oil demand growth.
  • Global jet fuel demand averaged 7.49m b/d in Jan-July, up 0.5m b/d on the year, Goldman Sachs said.
  • However, demand must accelerate to meet GS’ initial forecast for 0.6m b/d annual growth across 2024.
  • One concern for the industry will be consumer spending, up just 0.3% in the US in Q3. Jet fuel demand closely tracks to macroeconomic drivers.
  • Changing aircraft efficiency and geopolitical issues are also factors.
  • Average US aircraft fuel economy rose to 65.5 miles/gal in 2023, compared to 64.9 miles/gal in 2019.
  • Slowing international travel has also been a downside risk. International travel from Russia is down 40% on 2019 levels. US-China air traffic is down 25% due to trade wars.

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