Jet Fuel Prices and Crude Oil

What jet fuel is

Jet fuel is kerosene, a middle distillate refined from the same part of the barrel as diesel and heating oil. Most commercial aircraft use one of two grades. Jet A, used mainly in the United States, has a maximum freezing point of −40 °C. Jet A-1, used on most international routes, has a maximum freezing point of −47 °C, which suits long polar and high-altitude flights. Refiners can shift some output between jet and diesel, so their prices move closely together.

Jet fuel benchmarks

There is no widely traded jet fuel futures contract comparable to Brent or WTI. Physical jet fuel is priced off daily assessments by price reporting agencies such as S&P Global Platts and Argus. The main hubs are:

• US Gulf Coast pipeline jet, published daily by the EIA as a spot price
• New York Harbor and Los Angeles
• North-west Europe (cargoes delivered into the Amsterdam-Rotterdam-Antwerp area)
• Singapore jet kerosene, the Asian benchmark

IATA publishes a weekly global average in its Jet Fuel Monitor. When accessed on 13 October 2026 it reported a global average of $190.18 per barrel for the previous week, up 1.5% week on week.

The jet crack shows how much of the jet fuel price is refining margin rather than crude. It more than tripled between 2025 and September 2026. The closure of the Strait of Hormuz cut exports of jet fuel and diesel from Gulf refineries, and attacks on Russian refineries reduced supply further. Airlines therefore faced a bigger increase than the crude price alone suggests. For the general method, see crack spread explained.

How a $10 change in crude affects airline fuel bills

A barrel holds 42 gallons, so a $10 per barrel change in the jet fuel price equals 23.8 cents a gallon. According to the BTS, US airlines on scheduled services used 18,974 million gallons of jet fuel in 2025, at an average cost of $2.33 a gallon ($44.3 billion in total). If the full $10 is passed through and nothing is hedged:

18.97 billion gallons × $0.238 ≈ $4.5 billion a year for US airlines.

The same rule works for a single airline: multiply annual fuel use in gallons by 0.238 for each $10 move. If crack spreads also widen, as in 2026, the jet price rises by more than the crude price, and the effect is larger. To convert any barrel price into a per-gallon cost, use the oil price per gallon calculator.

In the first eight months of 2026, US airlines spent almost as much on fuel ($42.9 billion) as in the whole of 2025 ($44.3 billion), while using a third less fuel.

How airlines hedge fuel

Airlines can lock in part of their future fuel cost with financial contracts:

• Swaps fix a price for a set volume over a period, often against a jet fuel assessment.
• Call options cap the price while keeping the benefit if prices fall, at the cost of a premium.
• Collars combine a bought call and a sold put to cap costs within a range.
• Proxy hedges use more liquid contracts, such as Brent, WTI or NYMEX ULSD (heating oil) futures. These leave basis risk: in 2026, jet cracks widened far more than crude, so crude-only hedges covered only part of the increase.

Hedging smooths costs but does not remove them, and hedges roll off over time. Practice varies widely: some airlines hedge a large share of the next 12 months, others hedge little and rely on fares and fuel surcharges. For how futures and options work, see crude oil options.

From fuel cost to ticket prices

Fuel is one of an airline's largest operating costs, and a sustained rise usually shows up in fares and surcharges within months, especially on long-haul routes where fuel makes up more of the cost of each seat. Airlines also respond by cutting less profitable flights and flying more fuel-efficient aircraft.