Aviation Fuel: Introduction
- Aviation fuels are petroleum-based fuels used for aircraft propulsion that run on gas turbine engines. Various types of aviation fuels are used extensively to power aircraft in commercial as well as military applications across the globe. Rise in air traffic passengers across the globe, particularly in emerging economies; and fluctuations in crude oil prices are underpinning the evolution trajectories of the aviation fuel market. Increase in number of airline passengers has boosted the consumption of aviation fuel in developing regions. Growth in focus on reducing the carbon footprint of the overall transportation industry is driving the demand for biofuels. Renewable aviation fuels have generated significant attention of aviation industry players, especially in developed countries such as the U.S.
- According to the International Air Transport Association, passenger air traffic is has witnessed substantial rise in the last few years and the number is expected to double by the end of 2036. Recent improvements in global economic conditions have been driving the annual air passenger numbers since the last few years. Decline in average airfares is a key factor encouraging airline passengers, especially among the cost-sensitive passengers. Increase in cargo handling requirements also bodes well for the market.
Key Drivers and Restraints of Global Aviation Fuel Market
- The global aviation fuel market is expected to expand substantially due to the rapid rise in air passengers in developing countries such as those in Asia Pacific. Increase in revenue passenger kilometers over the past few years is propelling the market. Demand for aviation fuel has been rising significantly owing to the increase in capacity of passenger airlines in various developing regions. The shift toward adoption of more cost-effective aviation fuels and the fuels with less carbon footprint is driving the market.
- Growth in spending capacity of the middle class population in emerging economies is a prominent factor boosting the aviation fuel market. Liberalization in the aviation market brought about by positive regulatory thrusts in recent years also augurs well for the aviation fuel market. Increase in focus by regulatory agencies on the adoption of bio-fuels is also a key factor boosting the market. Manufacture of new passenger aircrafts in developing economies is expected to drive new demand dynamics in the near future. However, rise in prices of jet fuels is anticipated to pose a substantial challenge for airlines to sustain high air passenger traffic in the next few years.
Aviation Fuel: Product Type Segment
- In terms of product type, the global aviation fuel market can be segmented into air turbine fuel, aviation biofuel, avgas, and others
- The air turbine fuel segment is expected to account for significant share of the global aviation fuel market during the forecast period. It is anticipated to be followed by the avgas segment.
- The aviation biofuel segment is likely to expand at a rapid pace during the forecast period, due to the expansion of the renewable fuels market around the globe
Aviation Fuel: Application Segment
- In terms of application, the global aviation fuel market can be divided into civil, military, private, and others
- The civil segment is estimated to expand at a rapid pace during the forecast period. It is projected to be followed by the private segment.
- The military segment is likely to expand at a healthy CAGR during the forecast period, owing to the growth of the defense industry across the globe
COVID-19 Impact on Aviation Fuel Market
- On January 30, 2020, the International Health Regulations Emergency Committee of the World Health Organization (WHO) declared the Coronavirus disease (COVID-19) outbreak a public health emergency of international concern. Originating in China, the virus has spread to at least 213 countries and territories around the world.
- Several governments and private sector businesses are operating at a limited capacity or have ceased operations completely due to recent events surrounding the COVID-19 pandemic
- Manufacture of various consumer goods and other products across the globe has come to a halt due to the unavailability of raw materials, shortage of labor, etc. This is expected to hamper the aviation fuel market.
North America to Dominate Aviation Fuel Market
- In terms of region, the global aviation fuel market can be segregated into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa
- North America dominated the aviation fuel market in 2020. This trend is anticipated to continue during the forecast period. However, the aviation fuel market in Asia Pacific is anticipated to expand at a rapid pace owing to the significant investment in the transportation infrastructure across the region in the recent years. China, Indonesia, and India are expected to witness vast prospects in the near future. Rise in demand for air freight is estimated to keep the outlook attractive in some developing countries. These countries also stand to benefit from the growing affordability of international travel.
Key Manufacturers Operating in Global Aviation Fuel Market
The global aviation fuel market was consolidated in 2020. Major players have prominent presence in developed and developing countries. Key manufacturers operating in the global aviation fuel market include:
- Hindustan Petroleum
- Exxon Mobil
- Royal Dutch Shell Plc.
- Qatar Jet Fuel Company
- Total SA
- Chevron Corporation
- British Petroleum
- China Aviation Oil
Global Aviation Fuel Market: Research Scope
Global Aviation Fuel Market, by Product Type
- Air Turbine Fuel
- Aviation Biofuel
Global Aviation Fuel Market, by Application
Global Aviation Fuel Market, by Region
- North America
- Russia & CIS
- Rest of Europe
- Asia Pacific
- Rest of Asia Pacific
- Latin America
- Rest of Latin America
- Middle East & Africa
- South Africa
- Rest of Middle East & Africa