Aviation fuel market to hit US$325 billion by 2026
The Aviation Fuel Market is set to grow from its current market value of more than US$160 billion to over US$325 billion by 2026; as reported in the latest study by Global Market Insights, Inc. The rising construction and expansion of airports coupled with rising production and delivery of aircrafts are driving the market share.
Expanding middle class population coupled with proliferating tourism industry are playing a major role in supporting the market share expansion over the study period. Consumer are opting for air travel owing for superior and efficient travel over longer routes. Moreover, the reduced ticket fares due to the emergence of low-cost carriers are further boosting the aviation fuel market share.
Airliners are placing orders for multiple aircrafts for supporting the growing air travelling passenger demand. Moreover, aircraft manufacturers are facing issues related to orders backlogs for catering to the ever-growing demand. For instance, in November 2019, Emirates entered into a strategic agreement for purchasing 30 Boeing 787 jets worth US$9 billion. Additionally, Boeing currently has an order backlog of over 5,000 aircrafts.
Biokerosene is set to showcase the highest growth of over 33% over the study period. The significantly high growth rate can be attributed to the constant development and investments in this fuel for powering future aircrafts. Moreover, rising focus of regulatory bodies and industry participants to produce commercially viable green fuel for minimizing impacts on the environment will further expand the market share. For instance, in 2019, the U.S. Department of Energy announced the provision for a grant of US$1.7 Million to the Fuel Laboratory of Renewable Energy for accelerating the development of sustainable aviation fuel.
Business jets will account for over 14% market share over the projected timeframe. This can be attributed to the rising demand for such aircrafts for business travel and short distance trips. Moreover, the provision for multiple aviation ownership plans including fractional & timeshare ownership have enabled customers to own private jets conveniently, thereby positively impacting the industry growth. The rising demand for chartered aircraft services are also providing a positive outlook for the industry expansion.
Latin America and Middle East & Africa will witness healthy growth in the aviation fuel market share owing to increasing tourism. Recovering economy in Latin America with cross border merger of the airliners will further fuel the industry demand. Steady growth in air traffic will positively influence the product penetration. Increasing demand of business jets in the MEA is the prime factor driving the regional growth.
Few of the major players operating in the aviation fuel market size include Shell, BP, Chevron, Gazprom, Reliance Petroleum, and IOCL among others. Industry players are entering into strategic agreements and partnerships for expanding their business share. For instance, in November 2019, BP signed a strategic technical services agreement with Sonangol for expanding its business in Angola.
Some major findings of the aviation fuel market report include:
- Proliferating demand for low cost carriers along with improving tourism industry are augmenting the industry share
- Regulatory norms and policies coupled with fluctuations in raw material prices affect the aviation fuel prices significantly
- Major players operating in the aviation fuel industry are BP, Gazprom, Chevron, Shell, IOCL, HPCL, and Reliance Petroleum among others
- Companies are engaged in continuous investments and strategic collaborations for developing advanced sustainable fuel technologies