| Инвестиции
Key words: Jet fuel, aircraft fuel, Jet A and Jet A-1, Jet B, JP (Jet Propellant), Avgas, Military jet fuels
Aviation fuel

The aviation industry is a major consumer of jet fuel, a product of the family of middle distillates.
Fuel accounts for more than 35% of an airline’s operating costs, and is the number one expense for airlines ahead of labour costs.

To protect from volatile oil prices, airlines commonly practice fuel hedging taking into account a proportion of their future fuel needs.
Therefore, by hedging a percentage of its flat price exposure, a company reduces its risk profile.
It should be obvious that when Jet fuel prices fall airlines who locked in value at a higher price than the current spot level suffer a “hedging loss”.

It is worth saying that many airlines also partially hedge their exposure to fluctuations in exchange rates.
While crude oil and refined oil products trade on a US dollar-denominated basis, the main revenue stream can be in another currency.

Large airlines actively trade futures, forwards, swaps and options on crude oil, gasoil and jet fuel for maturities from six months to five years forward.

Generally, there are three families of motor fuel: Diesels, Kerosenes, and Gasolines. The Kerosene family includes Jet fuel, while Gasoline family includes Avgas. Both Jet fuel and Avgas used in the aviation industry.

Aviation fuel

The production of aviation fuel falls into two categories: fuel suitable for turbine engines (Jet fuel) and fuel suitable for internal combustion engines (aviation gasoline, aka Avgas).

1. Jet fuel for commercial use, sometimes classified as kerosene or naphtha-type.

The most commonly used fuels for commercial aviation are Jet A and Jet A-1.
The primary difference between the two is freeze point, the temperature at which wax crystals disappear.
Jet A, which is mainly used in the United States, must have a freeze point of -40ºC or below.
Jet A-1 must have a freeze point of -47ºC or below and for locations outside the United States.

The only other jet fuel commonly used in civilian turbine-engine powered aviation is Jet B, which is used for its enhanced cold-weather performance.

2. Military jet fuels:

Military organizations use a different classification system of JP (Jet Propellant) numbers.
Some are almost identical to their civilian counterparts; Jet A-1 is similar to JP-8, Jet B is similar to JP-4.

Kerosene-type fuels include Jet A, Jet A-1, JP-5 and JP-8.
Naphtha-type jet fuels, sometimes referred to as “wide-cut” jet fuel, include Jet B and JP-4. JP-4 is an older military jet fuel type and it was replaced by JP-8.

Typically, Military jet fuels contain unique, performance-enhancing additives.

3. Aviation Gasoline (Avgas)

Avgas actually comes in several grades (octane rating). All equipment and facilities handling avgas are colour coded:
• Green: AvGas 100 (100/130 Octane)
• Blue: AvGas 100LL, ‘low lead’ , (100/130 Octane)
• Red: AvGas 80 (80/87 Octane)

Generally 100LL is the most widely available aviation fuel because it works in the widest range of engines.

Avgas is sold in much lower volumes but to many more individual aircraft, whereas jet fuel is sold in high volumes to large aircraft.

Jet fuel has its own specification depending on a specific geographic region.


1.Jet Kero CIF NWE Cargoes (USD/MT). Typically, cargoes delivered into ARA, UK and northern France are considered in the assessment.

2. Jet Cargoes FOB NWE (USD/MT) with loading ports in NWE that are typically normalized on a
freight differential basis back to Rotterdam

3. Jet Barges FOB ARA (USD/MT). Jet barges are basis FOB Rotterdam. Any transactions occurring at other
loading ports in NWE are typically normalized on a freight differential basis back to
Rotterdam. Platts considers bids and offers from Rotterdam, Antwerp, Amsterdam,
Ghent and Flushing.

4. Jet Fuel FOB MED (USD/MT). The price is derivied from the Jet Kero CIF NWE
Cargoes quote adjusted for the cost of transportation from NWE into the Mediterranean region (Augusta in Italy).

5. JET FOB MED premium. Location: Basis FOB Italy

6. JET fuel CIF MED. The quote reflects the value of 30,000 mt cargoes, and it reflects a freight differential to the CIF Northwest Europe assessment.

US Market: Jet Kero 54 US Gulf Coast, Jet Kero Los Angeles, Jet Kero New York Harbor Barge, Jet Kero New Jersey Buckeye Pipeline

Asian region: Jet Kerosene FOB Cargoes Singapore ($/bbl), Jet CIF Japan, Jet CIF+FOB South China

There is also the Platts World Jet Fuel Index which is a weighted average of Platts’ jet fuel assessments from global trading and supply centers.
Platts indices mentioned above have been the main ones used by airlines but there are other Jet indices available as well, for example from Argus market services.