Are countries really running out of jet fuel?

0:00Welcome to the inquiry from the BBC World Service with me, Rajan Datar. Each week we have one question for expert witnesses and an answer. Before we begin, I just want to let you know that this episode was recorded on 30 April. Oil prices rise to their highest since the US-Israel war on Iran began. You've seen the headlines, you've heard the news. The global oil crisis prompted by war in the Middle East has led to warnings about jet fuel scarcity and the possibility of flight cancellations and price hikes. Two weeks ago, the International Energy Agency warned that Europe has maybe six weeks of jet fuel left and the bad news continues. According to the International Air Transport Association's price monitor, the cost of jet fuel has risen by 130 per cent year on year because of the blockade in the hall moves straight. Many people are worried if they're going to be

1:02able to take their holidays abroad, some are changing their plans and staying closer to home. While for many smaller economies around the world, the implications are serious. Will cargo flights still be able to deliver key commodities and vital supplies? But hang on one second, is it all really that bad? The European Union and many governments have said, hey, don't worry, there's no evidence of actual shortages of jet fuel so far, so keep calm and carry on. This week on The Inquiry, we're asking, are countries really running out of jet fuel? Part 1. The Source The Middle East is the centre of the global oil system and it plays a vital role in aviation fuel. Large volumes of jet fuel and the crude oil used to make it are produced in the region or moved through it on major global trade routes. But it's far from the only source because

2:03oil production is spread right across the world, including the Middle East, Europe, Africa and North America. Jet fuel, known as jet A or jet A1, is refined from crude oil, along with petrol and diesel, and is essentially a highly controlled form of kerosene. But before jet fuel reaches the wing, its journey begins deep underground, so let's drill down to the basics. How is crude oil, which is then converted into jet fuel or kerosene, created in the first place? Zach Aiman is professor of chemical engineering at the University of Western Australia. If we go back millions of years, then the ecology around the world, so the plants and animals that would have died in that period, they're going to be subsumed into the earth. And in that process, the pressure of all the rock on top of them is going to increase, and the earth's core is going to increase the temperature. So that high-temperature,

3:05high-pressure environment we actually call a kitchen, in geologic terms, and that kitchen is where we take all the plant and animal material, and it basically boils it down into a soup of all of these chemicals. That soup we now call crude oil. And when it comes to the best oil sources for jet fuel, well, the Middle East is in a premium class. The interesting part there is that every barrel of crude oil from different fields around the world, the composition is different because those plants and animals that died millions of years ago to be subsumed, each of those were different and existed in different quantities. The Middle Eastern oil fields are ones that dominate supply, largely because they have two properties that we really care about. The one you'll hear referred to is light, so light oil versus heavy oil. Light, meaning it tends to have more of the products that are high value inside of it, so the petrol, the diesel, the kerosene, jet fuel. So that property of being light is very present in Middle Eastern oil. And the second is what we call sweet, so you'll hear sweet versus sour oil.

4:10In effect, sweet means that it has an absence of sulfur, and we don't like sulfur in processing or in combustion because it tends to create really harmful effluence for the environment. So let's get to the refining process, which involves distilling crude oil through several stages. What are the metaphors we tend to use in classes a lot is if you're cooking something like a pasta sauce where you start out with a lot of raw ingredients and usually quite a bit of water. And as you bring that to a simmer, what you're effectively doing is boiling off the water and concentrating the valuable chemicals into that pot. So to refine a barrel of crude oil, what we do is we take that in and we don't put it in a single pot to boil it, but we actually stack 10 to 20 of these pots vertically and we call that a distillation column. The columns then are designed to take a particular blend of crude oil in one of the pieces of magic of most refineries is that they spend a lot of time practicing with different blends to make sure that the oil they buy off the market or from oil production companies is exactly right to put into

5:14their refinery. Plains require very tight specifications of oil because turbojet engines are highly calibrated and operate in especially sensitive environments like up in the sky. So the chemicals in the jet fuel have to be safe at high cold altitudes and there's very little margin for error. One crucial factor to take into account in terms of jet fuel supply is you can't just situate oil refineries anywhere. They can't be near big population centers for example, but for those countries that can safely accommodate refineries, well there is a big advantage. It depends heavily on the region. So if you're in the United States or in the Middle East where you have both a large amount of supply and refining capacity then it might be on the order of a few days to a few weeks to take it out of the ground put it through refinery and get it to a point of sale. If you're in a region that has perhaps extraction but no refining so you're dependent on importing from the

6:17refineries then it's going to be on the order of a few months for a supply out of the ground to make it through refinery and to the point of sale in your country. And significantly in the wake of COVID and Russia's full scale invasion of Ukraine, Europe has been closing down refineries while the Middle East and China have actually increased their capacity. Now just one more thing when we ask whether our supplies of jet fuels are running out we are referring more to access than actual reserves of oil which are relatively abundant even though much of it is currently inaccessible. So as opposed to saying we're running out of jet fuel slash kerosene it would actually I would say be more appropriate to offer that we're going to be start running low meaning the price of things like airline tickets or anything that uses that kerosene is going to increase probably more than the lack of supplies. So there is how we make jet fuel. The next stage of the process

7:19is delivery which has its own set of challenges time for our next expert guest. Part 2. Salbye Now once the jet fuel leaves the refinery it is then transported via a variety of means pipelines ships rail and trucks and airport fuel farms but just as in the production process carrying and storing the stuff is a very exact science as the fuel is so sensitive. My name is Ahmed Medi I'm a senior fellow at the Oxford Institute of Energy Studies and a managing director at Renaissance Energy Advisors. With jet what makes it slightly different is it does not like to be reacting with any other products so really the conditions for storing jet is far more stringent and that is partly down to its sell by date. There's an issue around the

8:19shelf life which is typically a few months and you'll usually have adjusting time model that would operate around jet. Jet fuels are actually just really concentrated at a few different major hubs and so you've got a limited on-site storage you know for example most major airports they will have like just enough tank capacity on-site for maybe a couple of days of normal operations so it does operate on that sort of just in time model. The problem is this just in time method that Ahmed mentions leads to price volatility. Airlines have to operate under these tight restrictions and because fuel constitutes such a large part of their costs they often protect themselves from wild supply and price swings by what's called hedging a kind of insurance policy. There's always a relationship between inventory and price when you naturally have low inventory there's more of a scramble for prompt physical demand there's always going to be a cost associated

9:25with taking out an insurance policy but it protects your price risk. Ahmed believes that one problem for Europe is how increasingly dependent it had become on the Middle East before the U.S. Israel war with Iran started. In February Iran closed the Strait of Hormuz effectively leading to a blockade of these oil shipments that are also vital for other parts of the world. In fact one oil field alone the Al-Dazor in Q8 supplies 10% of Europe's imported jet fuel. Meanwhile more than a quarter of crude oil bound for Southeast Asia also passes through the Strait and although some countries like South Korea and China do have substantial refining capacity themselves jet fuel from places like Q8 is still exported there. So what's Ahmed's assessment in relation to Europe? Are they running out? It's basically yes they had low stock

10:26piles they've lost their imports from the Middle East we're not all of them but you know most of them and on top of that they're already having to curtail demand and change the way that they fly. Okay so looks like we are going to have to adapt our travel plans according to Ahmed but what about potential solutions? That is what we're about to find out. You're listening to the inquiry from the BBC World Service. We're about to get stuck into part three of our jet fuel program but before we do I want to tell you about our huge back catalogue of inquiry episodes. This includes should we mind the moon and is it time to scrap the Commonwealth Games? You can find these and more wherever you get your podcasts just search for the inquiry and while you're there please press subscribe and turn on push notifications so you never miss

11:26an episode. Part three Nigeria's paradox So as we continue to investigate the state of our supplies of jet fuel it's worth considering how individual countries outside the West are coping. Take Nigeria and apparently paradoxical case because while it's actually an oil exporter it's economy is suffering as a result of global oil disruption. I am to maybe Oluole lead economies that stairs stairs is a financial and data company providing data intelligence on Africa to investment professionals. So petrol prices are significantly increased by over 30 to 50 percent across different states in Nigeria. Diesel prices are also higher, jet fuel prices are higher and of course the spin-off from crude oil prices rising is that gas prices are also higher. So across the board we've seen a significant increase in prices.

12:32Now when prices rise across the board in Nigeria from imported commodities to petrol prices it affects businesses as well not just households and in the context of Nigerian markets where small scale businesses account for over 80 percent of employment in Nigeria they are typically the hardest to further complicate matters because of infrastructural and security issues land transport is not wholly reliable and that puts even more pressure on their airlines. When you think of logistics and you think of the current insecurity in Nigeria you find that the evasion sector has become more intrinsic in terms of moving goods across Nigeria. The prices are significantly increased by over 200 percent and the reason why this is particularly important is because a lot of airlines in Nigeria experience high operational expenses.

13:32You find that airlines are pretty much running on the brink of significant losses and to some extent significant cases of bankruptcy. So passengers can't fly as much as they want and small businesses will be forced to switch cargo from planes to long journeys by road. Fact is Nigeria may be Africa's top oil producer but it exports almost all of its crude oil due to the lack of local refining capacity and as we mentioned having refineries in reasonable proximity to oil fields can be a major advantage. What's the practicality of that? What opportunities are there and how realistic is that? Shock term I think this conversation will continue but they would likely remain audio and by that I mean it's okay to have the conversations around Nigeria being an alternative but when we look at the structural or inefficiencies that exist in Nigeria's upstream and downstream petroleum sector you find that it will be very difficult for Nigeria to meet up to

14:33those expectations on a global level. It's not wrong for the rest of the world to see Nigeria as an alternative when you consider the richness of Nigeria's oil reserves and the possibility of Nigeria taking it instead but in terms of how practical it is for shock term I think it's going to take some time for Nigeria to do that. State refineries in Nigeria are not currently in operation but there is one private facility the Dangute refinery owned by Aliko Dangute who is widely regarded as Africa's richest man. It currently produces 650,000 barrels a day of refined products. Back in 2024 the company proclaimed it could meet a hundred percent of Nigeria's requirements for products including kerosene and aviation jet fuel and also have a surplus of each of these products for export but sadly that isn't happening yet because it doesn't make business sense. The important thing to note here is that Dangute is answerable to his investors. He has to

15:36recover his capital and ensure that the business is profitable and beyond that the idea of the business was not to serve Nigeria alone. It was to serve the product West Africa and Africa in itself. Do you think that there is a scenario where Nigeria could be so much more self-sufficient in oil? Nigeria does have a lot of reserves and resources for that but to simply answer your question the answer is yes but that would require a lot of governance changes, reduced corruption, a strong fight against insecurity, a strong fight against militant activities in the Niger Delta and pretty much South-South Nigeria and it would also require a strong support for the host communities for where the drilling and oil exploration primarily happens. The optimistic view for this is seeing the next 5 to 10 years. So the potential for alternative sources of jet fuel appear restricted at this present time but there is a view that if there's anything the current

16:42oil crisis is telling us it's that we ought to accelerate our search for other more secure and sustainable forms of jet fuel. Indeed the head of the International Energy Agency has declared this is the crisis that will turn countries away from fossil fuels including kerosene time for our next witness. Part 4 Beyond the Barrel The latest conflict in the Middle East has exposed how oil refinement and transportation can be disrupted so how might we mitigate that in the long term? My name is Lee Chow. I am a professor of aeronautics and astronautics at Purdue University. Lee is involved in alternative aviation fuel research that includes work funded by several aerospace companies. Aviation is quite exposed to the oil crisis and people don't always realize

17:44that aviation are airliners how dependent they are on the global oil system. Airline just don't buy fuel they are tied into the entire global network of the crude oil production. So when we talk about alternative fuels you know people usually think about yeah they're better for the environment that's absolutely true but on the other side it's also about energy security and resilience. The stakes when it comes to the environment are rising. Aviation is currently responsible for 3% of harmful CO2 emissions which is the biggest contributor to climate change and passenger traffic is predicted to double by 2050. There are alternatives in theory at least electric and hydrogen technologies are currently being developed for regional and short haul flights and then there's sustainable aviation

18:45fuel or SAF and this mainly comes from biomass based materials. We're talking cooking oils, fat, agricultural residue and plants. Long term advantage of SAF I think first of all is environmental impact. SAFs have lower emissions from the whole life cycle perspective. SAF definitely have all these environmental benefits. SAF can be produced locally right regionally using local raw materials that helps improve the energy security that not entirely depending on one global oil supply system. Lee says while it does have its advantages there are issues in place the aircraft producers have yet to figure out. SAFs are different from JDA due to lack of aromatic so ceiling could be a problem so they need to make sure that all the pumps

19:45valve the ceiling are okay. Also SAFs can differ from JDA in density right slightly even that it will affect the range of the aircraft right. For example you know the aircraft initially flies 2000 miles but with this different fuel which the density slightly different the energy contents slide different all those will change so the aircraft frame needs to figure that out because of density change it can also affect the center of gravity like distributing a fuel around the aircraft so those are the things we need to consider where we change to a different fuel but again I don't see major obstacles in implementing those fuels in the aircraft. There is one other major stumbling block the ability to produce SAF in meaningful quantities. Currently SAF production accounts for maybe less than 1% of the overall jet fuels so that

20:53basically means when nowhere close to you know even a few percentage that can be blended with JDA to power our fleet so that really means that we are not at scale for aviation applications. Critics argue that even optimistic SAF projections for well short of replacing fossil jet fuel at scale and improvements in efficiency on their own won't keep pace with how fast the aviation industry is growing. On the other hand as research and technology progress SAF at scale becomes more viable for example by using biomass that does not occupy huge areas of land or compete with food production like human waste and algae so although this is a way off and something that's not going to happen overnight there are alternative supplies of fuel that can power our airlines

21:54and potentially one day mitigate oil shortages. So now we return to our question. Our country is really running out of jet fuel. Aviation is critical to the global economy. We need fuel to power our constantly expanding fleets. So are we exaggerating the problem of the threat to our jet fuel supplies? Well yes in the sense that this isn't a problem of the physical reserves of the raw material to produce kerosene but rather a serious long-term issue around interrupted distribution. What's more there is also the pressing problem of reducing harmful emissions the experts seen unanimous. With an increasingly fragmented and frequently disrupted supply chain it could be beneficial to all if there was more self-reliance and diversification in the jet fuel market. You've been listening to the inquiry from the BBC World Service.

22:56Before we jet off I want to tell you that the inquiry has a huge archive of episodes available to listen to. This includes should we mind the moon and why are our taps running dry? You can find these and more wherever you get your podcasts. Just search for the inquiry and while you're there please press subscribe and turn on push notifications so you never miss an episode. This edition of the inquiry was presented by me Rajan Dattar. The producer was Matt Tulson. The researcher, Evie Absley, the editor Tom Bigwood and the technical producer was Mitch Goodall. We did something that no one else had ever done. There was such a excitement and energy about this moment. It opened the door for everything that rapidly followed. Witness history. History as told by the people who were there. I was walking in space. The first man ever to do so I felt almost insignificant like a tiny ant compared to the

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