Europe Has Only Six Weeks of Jet Fuel Left...Warnings of a ‘Worst-Ever Energy Crisis’

Financial News, New York – Correspondent Lee Byung-chulConcerns are mounting that Europe could soon face a jet fuel shortage, raising fears of an energy-driven economic shock. The International Energy Agency (IEA) has warned that a jet fuel supply crunch could materialize within as little as six weeks.
According to the IEA on the 16th (local time), Europe is estimated to have jet fuel inventories covering only about six weeks of demand. Supply risks have intensified sharply as shipments from the Middle East, which used to account for roughly 75% of Europe’s net jet fuel imports, have effectively been cut off.
The IEA stated, "Depending on how quickly the gap in supplies from the Middle East can be replaced in international markets, some European countries could face jet fuel shortages within the next six weeks."
The energy crisis is likely to spill over from a simple supply-demand issue into a broad-based economic shock. Fatih Birol, executive director of the IEA, warned, "A closure of the Strait of Hormuz would trigger the worst energy crisis we have ever experienced." He added, "Prices for gasoline, gas, and electricity would all rise, and some regions would be hit much harder than others."
The supply shock is expected to worsen further in April. Birol noted, "In April, there is virtually no spare capacity," and said, "The reduction in crude oil supply will be about twice the level seen in March." He stressed that this shock will feed into higher inflation and is likely to slow economic growth in emerging markets in particular, adding that "energy rationing could also become a reality."
Market experts are also voicing concern. Rico Luman, senior economist at ING Group, told CNBC, "With shipping operations halted, supplies from the Middle East have effectively been cut off, and securing alternative volumes is now urgent."
The impact on the aviation industry is also becoming visible. European carrier easyJet reported that flight bookings for the second half of this year have fallen 2% from a year earlier, reflecting the Middle East conflict and higher fuel costs. The airline said it incurred about £25 million in additional fuel expenses in March alone and has hedged more than 70% of its fuel needs for the summer season.
Aviation is a key pillar of the European economy. According to ACI Europe (Airports Council International Europe), the aviation sector generates around €851 billion in annual GDP and supports 14 million jobs. If jet fuel supply disruptions do materialize, the shock is therefore likely to spread across the broader economy.




pride@fnnews.com Lee Byung-chul Reporter