Walter BloombergEnergy

HORMUZ RISK PUTS GLOBAL JET FUEL SUPPLY ON EDGE Melius warns that any disruption in the Strait of Hormuz could severely hit jet fuel supply…

HORMUZ RISK PUTS GLOBAL JET FUEL SUPPLY ON EDGE Melius warns that any disruption in the Strait of Hormuz could severely hit jet fuel supply—one of the least flexible parts of the oil market. Around 3M bpd of refined products pass through the strait, but jet fuel is hardest to replace. Unlike crude, it has no easy rerouting options, strict specifications, and depends on specific refining setups. Inventories are already tight: global jet stocks are ~7M barrels below average, with Europe and the ARA hub at multi-year lows. The Middle East has just ~18 days of cover. Refineries can’t quickly adapt or restart, and strategic reserves hold crude—not jet fuel—limiting emergency response. Bottom line: the system has minimal buffer, and even a short disruption could trigger significant supply stress.
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