September 18, 2020

COVID-19 pandemic: Supply of Aviation Fuel dropped by 60 % in 1st half of 2020

The supply of jet fuel to local and international airlines landing and taking off in Ghana witnessed a drop of about 60 percent in the first half of 2020. That’s according to data from the National Petroleum Authority, NPA.

The dip in supply dropped to as low as 86 percent in the month of April alone. The following report takes a look at the challenges Jet fuel suppliers faced as a result of the COVID-19 pandemic.

In late 2019, the International Air Transport Association (IATA) published its “Economic Performance of the Airline Industry” report. It contained a 2020 forecast of 4.1 per cent growth in global air traffic demand.

Travel industry consulting firms predicted the continuing pattern of travel growth across all of the major components of travel including hotels, cruises and surface travel as well as air. The forecast for travel was sunny, with few clouds on the horizon.

Fast forward to September 2020, and the IATA is forecasting the worst financial performance in the history of commercial aviation, predicting a global loss of US$84 billion.

In Ghana, the industries supporting airlines with equipment parts and services have been struggling immensely. Providers of Jet Fuel also known as Aviation Turbine Kerosene supplied a total of 25.5 million litres in January, 2020, dropping to as low as 3.5 million in April before picking up to 10.2 million litres in June. The drop in supply from January to June represents a reduction of about 60 percent.

Jet Fuel in Ghana is currently being supplied by only 5 companies out of over 100 registered Oil Marketing Companies, with the market leader Puma Energy supplying over 60 percent of the product on the market.

With the resumption of international travel in different parts of the world, the earnings of the industry players are expected to improve.

Source: Business