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Jet fuel prices keep falling as crude spikes, but airlines miss the full benefit

Jet fuel spot prices eased a further 1-6% last week, despite a 7% surge in the underlying crude oil spot price.

Jet fuel prices fell 4.3% in New York, 4.0% at the US Gulf Coast, 5.9% in Los Angeles, 0.6% in Amsterdam and -3.3% in Singapore.

Over the past 12 months, jet fuel prices are down 60-61%, whereas the spot price of oil (WTI) has fallen by 59%.

Daily jet fuel prices (kerosene, cents per gallon) at New York, US Gulf Coast, Los Angeles, Amsterdam, Singapore vs Crude Spot price (WTI, USD per barrel): 24-Feb-09 to 03-Mar-09

 

24-Feb-09

25-Feb-09

26-Feb-09

27-Feb-09

02-Mar-09

03-Mar-09

one week
Change

12 month
Change

New York Harbor

125.38

128.27

132.52

130.77

118.45

120.05

-4.3%

-60.0%

U.S. Gulf Coast

120.38

123.27

127.52

126.52

113.2

115.55

-4.0%

-61.0%

Los Angeles

124.88

128.4

131.77

130.52

117.2

117.55

-5.9%

-61.3%

Amsterdam-Rotterdam-Antwerp

120.41

122.82

126.68

126.75

116.48

119.73

-0.6%

-60.3%

Singapore

115

118.1

122.62

122.14

118.81

111.19

-3.3%

-60.4%

WTI Spot

38.86

41.64

43.18

44.15

40.07

41.57

7.0%

-59.4%

Daily jet fuel prices (kerosene, cents per gallon) at New York, US Gulf Coast, Los Angeles, Amsterdam, Singapore: 25-Nov-08 to 03-Mar-09

In its Financial Health Monitor released this week, IATA stated crude oil prices appear to have formed a floor just above USD40 a barrel, following OPEC's large output cuts in Dec-2008.

The industry body stated, "as falling demand eases refinery bottlenecks the ‘crack spread' has narrowed to more normal levels and jet fuel prices have fallen towards USD50 a barrel". However, IATA noted that many airlines have part of their fuel bill locked into higher prices through their fuel hedging and hedging losses were a "large part of the larger than expected reported Q4 losses".