US refiners are pumping out jet fuel at a near-record pace as global demand surges because of Iran-war related supply disruptions.
US jet fuel output has reached above 2mn b/d in recent weeks, as refiners have added capacity and maximized yields, according to Energy Information Administration (EIA) estimates. The output is nearing the record weekly high of about 2.1mn bl set in July 2024.
Jet fuel production has increased by nearly 290,000 b/d since the start of the US-Israel war on Iran on 28 February, the EIA data show. The conflict has choked off oil and products supply through the strait of Hormuz and damaged energy infrastructure, causing soaring fuel prices. US refiners expect high margins to continue at least through the end of 2026.
Independent refiner Marathon Petroleum increased jet fuel capacity by 30,000 b/d at its 606,000 b/d Garyville refinery in Louisiana in March and plans to boost jet fuel capacity at its 253,000 b/d Robinson refinery in Illinois by 10,000 b/d in the third quarter.
US refiner Valero has also maximized jet production in its system, increasing yields to more than 30pc of total distillates in March, up from an average of 26pc, chief operating officer Gary Simmons said on a first quarter earnings call. Valero plans to push two more refineries into "jet production mode" to increase yields even further, he said.
Refiner HF Sinclair put into service a project that allows it to swing about 7,000 b/d between diesel and jet fuel at its 145,000 b/d Puget Sound refinery in Anacortes, Washington. The project is helping to supply the US west coast and Latin America, HF Sinclair said.
The jet fuel production boost is not limited to the US. Canadian integrated energy company Suncor in December started producing jet fuel at its 137,000 b/d Montreal refinery in Quebec, with the potential to grow it up to 16,000 b/d.
The original plan was to sell it domestically into airports in Montreal and Ottawa, but then the company saw the "unique market blowout" in the first quarter which continued into the second quarter "where jet fuel became short in certain markets", executive vice president of downstream Dave Oldreive said in a first quarter earnings call.
Suncor earlier this month sold jet fuel into Rotterdam in the Netherlands, he said. Europe has sought replacement supplies following the strait of Hormuz disruptions.
Jet fuel prices in the US climbed to record highs in March and early April following the start of the war.
At the US Gulf coast, jet fuel prices reached an all-time high of $4.73/USG on 2 April, the highest price since Argus launched its assessment in 1994.
Overall US jet fuel prices are expected to average $3.33/USG in 2026, the EIA said in its latest monthly Short-Term Energy Outlook (STEO) on 12 May. That forecast is up by 74pc from the EIA's estimate before the war.
Airlines pay the price
Jet fuel costs for all US airlines in March averaged $3.13/USG, up by 30pc from the same month in 2025, according to Bureau of Transportation Statistics data released on 6 May.
Some airlines are limiting capacity because of the higher prices. United Airlines plans to reduce its flight capacity by five percentage points in 2026 as its first quarter jet fuel costs averaged $2.78/USG, up by nearly 10pc from the first quarter of 2025.
Delta Air Lines expects its jet fuel costs to roughly double in the second quarter and will keep capacity flat year-over-year "until the fuel environment improves," chief executive Ed Bastian said on a first quarter earnings call last month.
Another large US carrier, American Airlines, expects its jet fuel costs to increase by $4bn in 2026 compared to previous plans.
One beleaguered US airline said it could not survive the rising prices. US low-cost carrier Spirit Airlines permanently shuttered its operations on 2 May, citing higher jet fuel costs, after filing for bankruptcy protection twice since 2024.
