No, Europe Won't Run Out of Jet Fuel
The Strait of Hormuz is closed, and it's a real pain. But the oil market is global. Airlines can find jet fuel. Whether they want to pay for it is another matter.
Dear readers,
When a dog bites a man, you’ll never see it become news.1 When a man bites a dog, though, it’s the story of the month.
I learned this aphorism decades ago in journalism school, and it’s still true. I can guarantee you it’s why so many reporters (and investment analysts) have been asking airline executives and pundits whether European airports soon will run out of fuel. With the Strait of Hormuz essentially closed and with Europe typically so reliant on Gulf oil, it sounds plausible.
But it’s not likely.
Airline executives generally say they’re not concerned. One of my favorite U.S. airline executives told me that while his operations team is “full of worriers” who fear every possible flight-disrupting scenario, like Coup d’état and natural disaster, none of these normally-jittery people has expressed concern about European jet fuel. It’ll be there this summer — it’s just a question of what it will cost.
Wizz Air Chief Commercial Officer Ian Malin also said he has no qualms, telling me his airline has secured its fuel for May and June, and is expecting its suppliers soon will secure stock for July.
”I struggle to accept that we will systematically run out of fuel,” Malin said. “Four weeks ago people were saying we had four weeks’ worth of fuel. Today there are no issues anywhere in our network. Now the press is saying it’s six to eight weeks. We have daily calls with all our airports and fuel suppliers. Nobody is saying they will run out.”2