Analysis: EIA Sees Jet Fuel Driving Oil Demand Growth

VIENNA (DTN) – Total product supplied, a proxy for demand, fell 1.588 million bpd in the last week of February as all petroleum fuels but kerosene-type jet fuel registered declines, Energy Information Administration data showed Wednesday (3/4).

Finished motor gasoline supplied was in line with year-ago levels in February. On the daily cumulative average, gasoline supplied was down 0.2% year-on-year and distillate fuel oil supplied down 0.8% year-on-year in the week ending February 27, respectively. Jet fuel supplied, in contrast, increased 5.3% year-on-year, and over the last four weeks was 6.8% higher than in the same period in 2025.

While road fuel demand growth seems to have stalled, domestic demand for jet fuel continued to rise, and last year reached its highest since 2019. Despite grounded flights amid last year’s federal government shutdown, jet fuel supplied still registered a 2.2% growth to 1.69 million bpd in 2025, according to monthly EIA data.

Total air passenger-miles are still lagging pre-COVID levels, in contrast to vehicle miles traveled, which last year reached new record levels. Yet, the effects on petroleum fuel consumption were much more pronounced in the case of jet fuel. Engine efficiency gains, the continued electrification of the American car fleet and non-petroleum fuels and additives have eaten away at gasoline demand. Jet fuel barely has to contend with these factors. Jet engines are becoming more fuel efficient, but air fleets are slow to rejuvenate compared to road transportation. While demand for so-called sustainable aviation fuel (SAF), a non-petroleum derived renewable blend stock for jet fuel, has in recent years soared, it still accounts for less than 2% of total jet fuel consumption.

In contrast to demand for gasoline, EIA in its latest short-term energy outlook forecasted jet fuel demand to continue growing this year and next, albeit at a slower pace as commercial air travel last year registered the slowest growth rate since 2020.

Soaring prices, however, could upend these expectations. The closure of the Strait of Hormuz has catapulted kerosene spot prices in the U.S. to three-year highs as the U.S.-Israeli war against Iran entered its sixth day, and a prolonged supply-chain disruption may keep prices in a demand-destructing range.