Even with its domestic market place, jet fuel use in the U.S. is still down by far more than fifty five% in contrast with year-in the past stages, according to weekly estimates from the U.S. Strength Information Administration.
Jet gasoline, with rigid high-quality technical specs, is commonly a premium merchandise and helps make a big contribution to refinery margins and profitability.
Pursuing the epidemic, having said that, refiners have been pressured to dump undesirable jet fuel into the broader and less-rewarding pool for other center distillates.
The diversion of surplus jet gasoline has contributed to oversupply and bloated shares of other center distillates and is weighing on refining margins.
In turn, oversupply of distillates and poor margins are incentivising refineries to limit their crude purchases and processing, holding again wider restoration in the oil marketplace.
(John Kemp is a Reuters current market analyst. The views expressed are his very own)