Less than a Month's Supply: Europe's Jet Fuel Stocks are Wafer Thin as Iran Tensions Flare

An Exolum refueling tanker fills an airplane at Almeria airport in Spain, April 19, 2026. REUTERS/Nacho Doce/File Photo
An Exolum refueling tanker fills an airplane at Almeria airport in Spain, April 19, 2026. REUTERS/Nacho Doce/File Photo
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Less than a Month's Supply: Europe's Jet Fuel Stocks are Wafer Thin as Iran Tensions Flare

An Exolum refueling tanker fills an airplane at Almeria airport in Spain, April 19, 2026. REUTERS/Nacho Doce/File Photo
An Exolum refueling tanker fills an airplane at Almeria airport in Spain, April 19, 2026. REUTERS/Nacho Doce/File Photo

Europe has imported jet fuel from the US and Asia, raised its refiners' output and drawn on stocks to keep planes flying – and yet it remains the region most exposed as renewed Middle Eastern tension raises the risk of further supply disruption.

Britain, France and Germany are particularly vulnerable in a continent where decades of refinery closures left it more reliant than most on Middle Eastern shipments via the Strait of Hormuz, Reuters said.

The Strait, conduit for around a fifth of the world's seaborne oil and liquefied natural gas until US-Israeli airstrikes unleashed a war on Iran at the end of February, partly reopened in June.

In July, however, a fragile truce has come under threat from strikes by both sides.

Data from consultancy Energy Aspects dated June 18 already anticipates a supply deficit across Europe of nearly 600,000 barrels ‌per day in ‌the third quarter, against surpluses of 116,000 bpd in the United States and 425,000 ‌bpd ⁠in Asia-Pacific.

Inventories stood at ⁠38 million barrels at the start of June, compared with 99 million in the United States, Energy Aspects said. That leaves Europe with less than 30 days of demand cover, Reuters calculations show — the tightest of the major jet fuel markets.

The most recent data available from the International Energy Agency's latest monthly report, showed provisionally jet fuel stocks were 10% higher year-on-year at the end of May, while refinery output rose 30%. The figures also implied only a month of leeway.

"We still do expect some tightness through August at this rate," said Janiv Shah, analyst at Rystad.

The European Commission has also acknowledged the ⁠situation could get worse.

EU Energy Commissioner Dan Jorgensen said in June the bloc faced tighter ‌jet fuel stocks towards the end of the summer holiday season and ‌that Brussels would coordinate releases of national reserves if needed.

CARGOES FROM CANADA TO SOUTH KOREA

Until war broke out at the ‌end of February, Europe had relied on the Middle East for around half of its jet fuel imports.

In March, ‌analysts had expected African countries, which sourced nearly all their jet fuel from the Middle East, to be the hardest hit.

However, they have managed to increased imports from Nigeria's Dangote refinery, as well as India and Oman, according to data from commodities intelligence firm Kpler.

Europe, meanwhile, has so far prevented supplies running out by turning to new sellers, such as Canada.

In June, Europe overall imported ‌673,000 bpd of jet fuel, its highest since October 2025, Kpler data showed.

The US and Nigeria were the biggest exporters to Europe, but Kuwait, Canada, India and ⁠South Korea also provided ⁠cargoes.

Imports from India in June reached their highest since February and nearly 25,000 bpd Kuwaiti barrels are due to arrive in August for the first time since early March through a ship-to-ship transfer on the ship Proteus Harvonne.

Before flows were interrupted, Kuwait was one of the biggest suppliers of jet to the region.

Among those who increased production to ease the strain, Italian refiners increased jet fuel production by 10% in the first four months of the year.

The countries' imports fell 6%, enabling domestic production to meet nearly 70% of demand in March and April, according to UNEM, Italy's fuel producers' association.

Eni, which accounts for around half of Italy's jet fuel production capacity, boosted output by importing semi-finished products from outside Europe, industry sources said.

Jet fuel prices in northwest Europe meanwhile have fallen to around $133.27 a barrel from a record $215.32 at the end of March, easing pressure on airlines. Fuel typically accounts for between 20% and 25% of operating costs.

Immediate discounts to air ticket prices are unlikely, analysts say, as demand is strong and capacity is limited, especially after many carriers cut flights to maximize fuel supplies.



Europe Can’t Afford to Miss AI Revolution, Says ECB Chief

European Central Bank President Christine Lagarde addresses a press conference following the ECB Governing Council meeting at the ECB headquarters in Frankfurt, Germany, July 23, 2026. (Reuters)
European Central Bank President Christine Lagarde addresses a press conference following the ECB Governing Council meeting at the ECB headquarters in Frankfurt, Germany, July 23, 2026. (Reuters)
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Europe Can’t Afford to Miss AI Revolution, Says ECB Chief

European Central Bank President Christine Lagarde addresses a press conference following the ECB Governing Council meeting at the ECB headquarters in Frankfurt, Germany, July 23, 2026. (Reuters)
European Central Bank President Christine Lagarde addresses a press conference following the ECB Governing Council meeting at the ECB headquarters in Frankfurt, Germany, July 23, 2026. (Reuters)

European Central Bank chief Christine Lagarde said Wednesday that the continent could not afford to miss out on the artificial intelligence revolution as the continent's growth model comes under increasing pressure.

The United States and China are seen leading the AI race, with their companies producing the most advanced large language models and rapidly building vast new data centers.

"Europe largely missed out on the first digital revolution, as the commercial gains from the spread of information and communication technologies were captured disproportionately elsewhere," Lagarde said at a World Economic Forum event in Geneva.

"We cannot afford to repeat that experience with artificial intelligence, the second digital revolution," she said.

While European companies are investing heavily in AI, barriers in the eurozone are hindering them from scaling up their operations, she said.

The "fragmentation" of EU markets means firms are not competing enough across the whole eurozone and also struggled to raise funds, particular when compared to US peers, Lagarde said.

"The result is fewer firms growing to global size and slower diffusion of new technologies across the economy."

She added that scale is particularly important for Europe to be able to compete in AI and other new technologies at a time when Europe's post-war growth model faces major challenges.

She noted that Europe had long benefitted from "three pillars" -- a rules-based global order underpinned by US security guarantees, cheap energy and expanding global trade.

"All three are weakening as the international environment changes," she said.

"These shifts suggest that Europe's post-war growth model is eroding. And it is unlikely to return to the form we once knew."

The return of US President Donald Trump to the White House, in particular, has shaken relations between the United States and Europe.

He has imposed hefty tariffs on European Union imports and questioned long-standing US commitments to the continent's security.


Trump Pauses 50% Tariffs on Canadian Goods for Three Days

This aerial view shows a Capital Southern Transportation, Inc. truck passing over the Peace Bridge between Canada and the US in Fort Erie, Ontario, on August 18, 2026. (AFP)
This aerial view shows a Capital Southern Transportation, Inc. truck passing over the Peace Bridge between Canada and the US in Fort Erie, Ontario, on August 18, 2026. (AFP)
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Trump Pauses 50% Tariffs on Canadian Goods for Three Days

This aerial view shows a Capital Southern Transportation, Inc. truck passing over the Peace Bridge between Canada and the US in Fort Erie, Ontario, on August 18, 2026. (AFP)
This aerial view shows a Capital Southern Transportation, Inc. truck passing over the Peace Bridge between Canada and the US in Fort Erie, Ontario, on August 18, 2026. (AFP)

US President Donald Trump paused the planned rollout of punishing new tariffs on Canadian goods late Tuesday, as both sides indicated they were close to a broader trade agreement after weeks of talks.

Trump announced the three-day reprieve from 50-percent duties on select goods just hours before a midnight deadline.

The delay was "based on the fact that Canada and the U.S.A., subject to the finalization of documents, have a DEAL!" Trump wrote on his Truth Social platform.

Canadian Prime Minister Mark Carney was less definitive, saying "substantial progress has been made" towards a comprehensive trade deal, but "there is important work still to be done."

Ottawa and Washington have held intense negotiations on revising their existing deal, the United States-Canada-Mexico Agreement (USMCA), which Trump signed and praised during his first term but now says needs to change.

The US Trade Representative's office said on X that the pact between Washington and Ottawa is set to "include comprehensive market access for all American goods, economic security commitments, digital trade alignment" and other provisions.

A proclamation by Trump to pause the duties added that the suspension came about as "Canada has expressed a commitment to remove the discriminations or unreasonable and unequal impositions at issue."

Carney said the prospective deal aims to "address outstanding trade issues and deliver greater certainty and real benefits for Canadian businesses, workers, farmers and families."

- 'Discriminatory treatment' -

Trump had signed orders for the 50-percent duties last month, with the White House alleging "discriminatory treatment" by Canada against US automobile and dairy products.

The new tariffs would cover products such as wine, hockey sticks and cement.

They target around 5.5 percent of Canada's exports to the United States, worth about $20 billion, Oxford Economics estimates.

While this only poses a "modest" negative risk to Canada's economy, Oxford Economics said in a recent report that the duties would "affect central Canada's manufacturing sector much more severely."

Canadian negotiators have been in Washington to push for a deal to avoid the new tariffs and also secure relief on Trump's sector-specific duties, which have battered Canada's auto, steel, lumber and aluminum industries.

Ottawa reportedly offered concessions like pressuring provinces to put some US beverages back on their shelves.

Without going into details, Trump added in his Truth Social post: "The great Keystone XL Pipeline, long ago killed by Sleepy Joe Biden, may be awoken from the grave!"

Trump has previously called for the revival of the controversial project opposed by environmental activists, which was blocked under his predecessor Biden.

- Political concerns -

"It's not unusual for a trade negotiation to go right up to the deadline," former US commerce official Christopher Padilla told AFP.

He expects that the Trump administration threatened new tariffs to try and win early concessions from Canada as the countries negotiate new terms for the USMCA.

Oxford Economics anticipates that manufacturers who stand to be most impacted include those in the cement, paper, printing, wood, clothing and electronic equipment sectors.

With the US Supreme Court striking down many of Trump's global tariffs earlier this year, the president had tapped an untested legal provision for the new duties targeting Canada.

The US duties will not apply to Canadian energy, potash or goods already facing sector-specific tariffs, but are set to hit products covered by the USMCA.

Trump's trade envoy Jamieson Greer previously said the tariffs aimed to "hold Canada accountable" for its retaliation against the United States.


Oil Extends Climb on Prolonged Hormuz Export Uncertainty

An automated oil drilling rig operated by ExxonMobil in Midland, Texas, US, August 17, 2026. REUTERS/Sheila Dang
An automated oil drilling rig operated by ExxonMobil in Midland, Texas, US, August 17, 2026. REUTERS/Sheila Dang
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Oil Extends Climb on Prolonged Hormuz Export Uncertainty

An automated oil drilling rig operated by ExxonMobil in Midland, Texas, US, August 17, 2026. REUTERS/Sheila Dang
An automated oil drilling rig operated by ExxonMobil in Midland, Texas, US, August 17, 2026. REUTERS/Sheila Dang

Oil prices climbed for a fourth straight day on Wednesday as investors weighed conflicting messages from Tehran and Washington on whether the Strait of Hormuz is open to ships.

Brent crude futures climbed 69 cents, or 0.8%, to $91.71 by 0415 GMT, while US West Texas Intermediate crude futures were up 76 cents, or 0.9%, to $85.70 a barrel, Reuters reported.

Both contracts closed on Tuesday at their highest in more than three weeks as hopes of peace between the US and Iran faded.

US President Donald Trump said on Tuesday no talks were taking place with Iran ⁠and insisted the ⁠Strait of Hormuz was open, contradicting Iran's assertion that the critical waterway remained shut to shipping.

A temporary ceasefire agreement expired on Monday and a senior Iranian official told Reuters that his country was moving to a "fully offensive" military posture due to the diplomatic stalemate, though there were no reports of fresh strikes by either side on Tuesday.

"The shipping risks are increasing again as attacks from Iran ⁠and Houthis remain prevalent in both key chokepoints, keeping oil prices supported in the near term," said June Goh, senior oil market analyst at Sparta Commodities, referring to the Strait of Hormuz and Bab el-Mandeb strait.

Shipping through Hormuz slowed, data showed on Wednesday, as most shipowners avoided the key waterway due to a lack of clear signaling on its reopening from a blockade.

"However, Gulf producers are finding alternative export routes to bring oil out to the Gulf of Oman," said Goh. "If sustainable, this could help increase shut-in production from these two producers."

To avoid the Strait of Hormuz, Iraq's cabinet approved mechanisms for exporting Iraqi ⁠crude through specialized international ⁠and local companies and via multiple export outlets, the government said on Tuesday.

The contracts under the new mechanism will run for three months starting September 1, according to a statement issued after the cabinet meeting.

In the US, crude oil and distillate inventories fell, while gasoline stocks rose last week, market sources said, citing data from the American Petroleum Institute.

Official inventory numbers from the US Energy Information Administration are due at 10:30 a.m. ET (1430 GMT), with analysts polled by Reuters expecting crude stocks fell by about 600,000 barrels in the week ended August 14.