Global Jet Fuel Demand Faces Decline Amid Economic Slowdown and Travel Budget Cuts

Jet fuel demand is expected to decline as consumer spending slows, impacting travel budgets and oil prices. Though initially predicted to fuel growth, demand has fallen short of expectations, especially in major markets like the U.S. and China, leading to revised forecasts by financial and energy institutions.

Global jet fuel demand is forecasted to decline as a slowdown in consumer spending affects travel budgets, potentially impacting oil prices in the coming months. Initially expected to drive growth, jet fuel demand has underperformed, particularly in key markets like the U.S. and China. This trend has led to revised projections by financial and energy institutions.

Jet fuel, comprising about 7% of global oil demand, showed a near 500,000-bpd rise this year through July, but still fell short of expected growth. Goldman Sachs revised its forecast downward, signaling demand growth from August to October at approximately 400,000 bpd, below the 600,000 bpd annual growth forecast.

U.S. consumer spending growth averaged 0.3% through June, the slowest in over a year, impacting leisure travel and subsequently jet fuel demand. The International Energy Agency noted limited scope for growth in U.S. jet fuel consumption due to an economic slowdown. In addition, trade wars, and a shift in consumer preferences contribute to the long-term hit on jet fuel demand.

(With inputs from agencies.)