Global Jet Fuel Squeeze Escalates as Middle East Conflict Traps Persian Gulf Cargoes

A deepening jet fuel supply squeeze stemming from conflict in Iran and the blockade of the Strait of Hormuz is threatening to disrupt commercial aviation across global markets, according to reporting by Bloomberg. The disruption has hit Asian aviation markets first, where refiners face severe crude shortages, but the deficit risks expanding into the European Union and the United Kingdom over coming weeks due to their heavy reliance on Persian Gulf refining hubs. Even in the United States, regional dependencies on Asian refined product streams have exposed domestic operations to supply strains, despite the country maintaining net oil exporter status.

The conflict has effectively trapped a major portion of global jet fuel exports inside the Persian Gulf, while Asian refiners have been forced to lower run rates due to missing Middle Eastern crude feedstocks. Last year, global jet fuel demand averaged 7.8 million barrels per day, a figure that includes kerosene used for heating, according to Bloomberg's analysis. Although member countries of the International Energy Agency agreed to release 400 million barrels of emergency oil stocks—the vast majority of which consists of crude oil—historical precedents suggest that only a minimal proportion of released refined products will directly support the aviation sector.

In response to jet fuel costs that have doubled since the beginning of the year and outpaced gains in crude oil, carriers have begun trimming operations. Airlines across Vietnam and New Zealand have instituted flight cancellations, while United Airlines Holdings Inc. has moved to drop unprofitable routes. Meanwhile, Chinese authorities have curbed refined product exports to protect domestic inventory. Vikas Dwivedi, global energy strategist at Macquarie Group, stated in an interview with Bloomberg that "You can't fly the same amount of flights without the same amount of jet fuel," warning that extended closure of the Strait of Hormuz will accelerate aircraft groundings and that full supply chain recovery could require weeks or months even if the waterway reopens.

The international flow of aviation fuel is being further reshaped across European pipeline and distribution networks. Malta-headquartered commodity trader Alkagesta, which trades petroleum products, biofuels, fertilizers and steel across more than 48 countries, operates as a key supplier of jet fuel into the NATO Central Europe Pipeline System. As reported by Bloomberg in a subsequent April 2026 report detailing military prioritization of the NATO pipeline, Alkagesta chief executive Orkhan Rustamov described how heightened military utilization of European pipeline infrastructure has altered commercial distribution dynamics, adding to regional supply chain pressures created by the Middle East refining squeeze.