PARIS: Europe may have only six weeks’ worth of jet fuel remaining, threatening severe economic consequences for the continent, the International Energy Agency warned Thursday.
“Several European countries may start to face shortages of jet fuel in the next 6 weeks, depending how much they are able to import from international markets to replace the lost supply from the Middle East, which accounted for 75% of Europe’s net imports of jet fuel previously,” the IEA said in an emailed statement to CNBC.
In an interview with The Associated Press on Thursday, IEA Executive Director Fatih Birol said a blockade of the Strait of Hormuz would trigger “the largest energy crisis we have ever faced.” He added that the broader economic impact would include higher gasoline prices, higher natural gas prices and higher electricity costs, with some regions “hit worse than the others.”
Birol previously warned that the crisis would intensify in April as oil supply constraints worsen. “In April, there is nothing,” he said last month. “The loss of oil in April will be twice the loss of oil in March. On top of that you have LNG and others. It will come through to inflation, I think it will cut economic growth in many countries, especially emerging economies. In many countries the rationing of energy may be coming soon.”
## ‘Harsh economic impacts’
Analysts echoed similar warnings earlier this week. Claudio Galimberti, chief economist at Rystad Energy, told CNBC on Tuesday that the situation facing airlines “pretty much depends on how many barrels will be flowing through the strait.”
Rico Luman, senior economist at ING, told CNBC’s “Squawk Box Europe” on Tuesday: “We’ve seen these vessels now stopping, so supplies from the Middle East have run out, and we need replacements.”
Air travel generates 851 billion euros (nearly $1 trillion) in gross domestic product for European economies annually and supports 14 million jobs, according to ACI Europe, an airport trade group.
European airline EasyJet said Thursday that the Middle East conflict and rising fuel costs are weighing on customer bookings, with tickets purchased for later in the year down 2% compared with 2025. The budget carrier said it incurred roughly £25 million ($34 million) in additional fuel costs in March alone and hedged at least 70% of its summer fuel to protect against volatility.
ACI Europe said last week that peak summer travel would be disrupted, with “harsh economic impacts” for several member states that rely on the seasonal economic boost.