Mercedes Mullins
The price of aviation fuel is a highly variable figure, influenced by a multitude of factors such as location, market conditions, fuel type, local taxes, and regulations. For instance, the national average price for Sustainable Aviation Fuel (SAF) in the US is $8.67 per gallon, whereas the average jet fuel price on February 16, 2024, was 276.21 cents per gallon (equivalent to $116.01 per barrel). The cost of jet fuel is also subject to fluctuations, with prices changing daily due to the volatile nature of global crude oil prices.
| Characteristics | Values |
|---|---|
| Average cost of 1 gallon of jet fuel | $3 to $8 per gallon |
| Cost of Sustainable Aviation Fuel (SAF) | $8.67 per gallon |
| Jet fuel price in FAA Alaska region | $8.12 per gallon |
| Jet fuel price in FAA Central region | $5.53 per gallon |
| Excise taxes on jet fuel | 21.9 cents per gallon |
| Fuel burn rate for light jets | 100-200 gallons per hour |
| Fuel burn rate for heavy jets | 300-500 gallons per hour |
| Fuel as a proportion of a jet's operating expenses | Over half |
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What You'll Learn
Average jet fuel price
The price of jet fuel varies depending on the region and the source from which it is procured. The average price of jet fuel across the United States is $8.67 per gallon for Sustainable Aviation Fuel (SAF). The price of jet fuel in the FAA Alaska region is the highest, at an average of $8.12, while the FAA Central region has the lowest price, at an average of $5.53. These prices are averaged over 3,192 FBOs reporting aircraft fuel prices over the past 30 days and do not include additives.
The Jet Fuel Price Monitor provides weekly updates on the average prices of aviation jet fuel worldwide. According to the monitor, the global average jet fuel price rose by 0.5% to $90.21/bbl in the week leading up to June 1-3, 2025. This price is based on daily assessments of jet fuel spot prices in relevant regional markets.
The Jet Fuel Price Index, published by S&P Global Platts, provides a more detailed breakdown of jet fuel prices by region. The index compares current prices to the average spot prices in 2000, weighted by demand, to calculate the overall rise in markets compared to the base period. For example, an index value of 200 indicates that prices have doubled since the year 2000.
While the Jet Fuel Price Monitor and the Platts Jet Fuel Price Index provide valuable insights into the average jet fuel prices on a global and regional level, it is important to note that the fuel prices can vary significantly depending on various factors such as supply and demand, market holidays, and regional dynamics.
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Fuel cost fluctuations
Fuel costs are a significant expense for jet owners and operators, often accounting for over half of a jet's operating expenses. The cost of jet fuel per gallon varies widely, influenced by numerous factors that are subject to change. These factors include the type of jet, the region, the time of year, market conditions, fuel type, local taxes, and regulations. For instance, the average price of Sustainable Aviation Fuel (SAF) in the United States is $8.67 per gallon, while jet fuel prices at specific airports can range from $5.53 to $8.12 per gallon.
The price of jet fuel is also impacted by global crude oil prices, which fluctuate daily. For example, on February 16, 2024, the average jet fuel price was 276.21 cents per gallon ($116.01 per barrel), but it increased by 1.2% compared to the previous week and 6.6% compared to the month before. This volatility in crude oil prices can be attributed to various factors, such as political events, conflicts, supply chain disruptions, and economic activity.
Due to sustained demand, popular tourist destinations often experience higher fuel prices during peak seasons or even throughout the year. Similarly, economic hubs with a high volume of business travelers tend to have above-average fuel prices. Conversely, remote or less popular tourist destinations generally have lower fuel prices due to reduced demand, increased storage capacity, and less competitive pressure. Jet owners can benefit from lower prices if their hangars are located near oil refining centers, as multiple aviation fuel suppliers in the area create a competitive pricing environment.
To manage fuel costs effectively, jet owners and operators should regularly monitor fuel price trends and market fluctuations. They should also consider factors such as the jet's fuel burn rate, flight distance, and duration when planning their trips. By staying informed and flexible, they can make strategic choices to optimize their fuel expenses.
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Excise taxes
The price of airplane fuel can vary depending on various factors, and there are additional costs in the form of excise taxes. Excise taxes are imposed on specific goods and services, such as fuel, and are usually included in the market price of the product. In the context of aviation, excise taxes are applied to aircraft operations and fuel consumption, and these taxes can vary based on the type of aircraft, the purpose of the flight, and the location.
In the United States, federal excise taxes (FET) on aviation fuel have undergone changes over time. For example, as of October 1, 2005, a federal excise tax of $0.244 per gallon was imposed on the removal of kerosene from the terminal rack. This tax was initially credited to the Highway Trust Fund, with a portion eligible for transfer to the Airport and Airway Trust Fund based on the amount of fuel used in aviation. Additionally, commercial operators may be exempt from certain FET obligations, as outlined in the Internal Revenue Code (IRC) section 4092, which exempts fuel used in foreign trade from the full 21.9 cents per gallon tax.
It's important to note that the rules and rates of excise taxes on aviation fuel can be complex and subject to change. Aircraft operators are advised to consult with tax experts and stay updated with the latest regulations to ensure compliance and understand the tax implications of their operations.
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Demand and price
The price of aviation fuel is subject to constant change due to various factors, including location, market conditions, fuel type, local taxes, and regulations. As a result, determining the exact cost of one gallon of airplane fuel is challenging. However, examining the interplay between demand and pricing can provide valuable insights into the dynamic nature of aviation fuel costs.
Demand for jet fuel varies across regions, with popular tourist destinations and economic hubs experiencing higher demand during peak seasons or throughout the year. This elevated demand contributes to upward pressure on prices. For instance, regions with a significant influx of business travelers, such as economic centers, tend to witness price surges. Similarly, areas of political tension may face supply chain disruptions, affecting refinery production and resulting in above-average fuel prices. In contrast, remote or less popular tourist destinations generally have lower fuel demand, which can stabilize prices.
The proximity of jet owners' hangars to oil refining centers and the availability of diverse aviation fuel suppliers can also influence pricing. When multiple suppliers compete for customers, pricing becomes a crucial factor in attracting clients, potentially driving prices down. Additionally, the cost of jet fuel is closely tied to global crude oil prices, which fluctuate daily. For example, sanctions against Russia due to its war with Ukraine reduced fuel supplies, causing a rapid increase in crude oil prices and, consequently, jet fuel prices.
Excise taxes imposed by certain governments also contribute to the overall cost of aviation fuel. According to the NBAA, jet owners, on average, pay an additional 21.9 cents per gallon in excise taxes. These taxes vary across regions and countries, impacting the final price of jet fuel. While the exact calculation of jet fuel prices involves numerous complex factors, understanding the relationship between demand and pricing provides valuable insights into the volatile nature of aviation fuel costs.
As of February 16, 2024, the average jet fuel price was 276.21 cents per gallon, equivalent to $116.01 per barrel. This price represented a 1.2% increase compared to the previous week and a 6.6% rise from the prior month. The global average jet fuel price continued to rise, reaching $90.21 per barrel, a 0.5% increase from the preceding week. These fluctuations demonstrate the dynamic nature of aviation fuel pricing, influenced by various factors, including demand, supply, geopolitical events, and economic conditions.
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Fuel suppliers and pricing
Aviation fuel suppliers are essential to the aviation industry, providing the fuel required to power commercial and private aircraft worldwide. They play a crucial role in helping airlines manage costs and improve profitability, especially in the face of rising fuel prices. Fuel prices can significantly impact the aviation industry, as they contribute to a large portion of total operating expenses, often accounting for up to 30% of these expenses.
Aviation fuel suppliers offer competitive fuel prices and provide value-added services such as fuel planning, routing, permits, and flight support services. These services help businesses enhance efficiency and minimise fuel-related expenditure. Suppliers also handle the entire refuelling process, from scheduling to on-site refuelling, allowing businesses to focus on other areas. Additionally, suppliers have expertise in fuel procurement, enabling businesses to negotiate better fuel prices and develop hedging strategies to mitigate price volatility.
Phillips 66 Aviation, one of the largest refiners of aviation fuel in North America, provides a secure fuel supply to support the growth of branded FBOs. They offer competitive programs and have a vast supply infrastructure, including 20 third-party suppliers and access to multiple fuel exchanges. Phillips 66 Aviation aims to make each flight more convenient and cost-effective for its customers.
While aviation fuel suppliers play a critical role in the industry, they also face challenges due to the dynamic nature of energy prices. To address this, suppliers employ various strategies, including supplier negotiations, volume pooling, and hedging techniques, to provide competitive fuel prices to their customers. These strategies assist airlines and aviation businesses in managing their fuel costs effectively.
The cost of aviation fuel can vary across regions, and organisations like IATA (International Air Transport Association) provide resources such as the Fuel Price Monitor to help track fuel prices. The average jet fuel price can be monitored through sources like Platts Jet Fuel Price Index, which provides daily assessments of spot prices in relevant regional markets. This information empowers aviation businesses to make informed decisions and adapt to market fluctuations.
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Frequently asked questions
The cost of jet fuel per gallon varies depending on several factors, such as location, market conditions, fuel type, local taxes, and more. The price can range from as low as $3 to as high as $116 per gallon.
The cost of airplane fuel is influenced by global crude oil prices, which fluctuate daily. Fuel shortages, conflicts, and disruptions in supply chains can lead to increased prices. Tourist destinations and economic hubs may also experience higher fuel prices due to sustained demand.
Smaller jets typically consume less fuel compared to large, long-range jets. Lighter jets may use around 100-200 gallons per hour, while heavy jets can use 300-500 gallons per hour. Newer jet models may have technology that optimizes fuel consumption.
To estimate fuel costs, consider the price per gallon, the jet's fuel burn rate (gallons per hour), and the total flight distance and duration. Different jet models have different burn rates, so knowing your aircraft's specific rate helps in estimation.
Saving on jet fuel requires careful planning. Strategies include choosing efficient flight paths, considering multi-leg trips, and exploring refueling options at airports with competitive fuel prices. Booking fuel in advance may offer discounts, and joining a fuel purchase program can provide volume discounts.
