US refiners churned out jet fuel at the fastest pace since COVID, according to government data last week, roaring back to meet forecasts for record air travel this summer.
The US Energy Information Administration data showed refiners’ net production of jet fuel rose to about 1.9 million barrels per day (bpd) last week, an increase of 8 per cent versus the same period in the previous year and the largest weekly total since January 2020.
Government agencies and travel groups are preparing for the highest number of passengers at airports this summer, with jet fuel consumption rising above pre-pandemic levels for the first time. A record 5.74 million people will be flying around the July 4 holiday, according to estimates by the American Automobile Association.
A recent note from JPMorgan analysed that global jet fuel demand has surged above pre-pandemic levels for the first time. Data from the US Energy Information Administration showed the four-week average jet fuel demand at 1.75 million barrels per day (bpd) last week, the highest for this time since 2019.
According to Matias Togni, founder of energy research firm Galpon Shipping & Trading, greater refinery output should help keep the market well-supplied to match the surge in demand expected over the holidays. Since the beginning of the year, US refiners have built more than 2 million barrels of jet fuel in stockpiles, pushing inventories to 41.95 million barrels as of June 14. That is 2 per cent more than last year and in line with the five-year seasonal average.
Despite higher travel forecasts, domestic airfares around the July 4 holiday are down 2 per cent from last year, said AAA. And according to flight tracker Airportia, total US flights are up 1 per cent compared to last year. On Thursday alone, Airportia tracked 30,264 US flights, a 7.2 per cent increase over the same time last year.
Boosting jet fuel production, combined with rising passenger traffic, indicates that the hard-hit aviation industry is on the path to a full recovery from the pandemic. Building stockpiles and raising output will be important for US refiners to weather the demand, typically strong in peak travel seasons.