EIA: This Week in Petroleum - 26 August 2020 - eng ^{Избранное}

Flight data confirm changes in overall U.S. jet fuel consumption estimates

Global consumption of transportation fuels has trended lower during the past several months as a result of the spread of the 2019 novel coronavirus (COVID-19) and efforts to contain and mitigate it. Although total U.S. jet fuel consumption has been particularly affected by these measures, averaging 29% lower during the first five months of 2020 than during the same time last year, analysis of flight-level data provided by Cirium on commercial passenger flights suggests that demand for jet fuel in the United States is likely recovering faster than in most other major aviation markets. Increased demand for aviation services and the compartively low share of travel that crosses international borders in the United States are driving this relatively fast recovery (Figure 1).

Figure 1. Ratio of 2020 jet fuel consumption by commercial passenger jets to 2019 consumption

The U.S. Energy Information Administration (EIA) estimated the amount of jet fuel consumed each day by commercial passenger jets by using data from Cirium. This was done by first calculating the distance traveled by each of the 36.8 million global commercial passenger flights flown between January 2019 and mid-August 2020, and second, combining those distances with modeled average fuel efficiencies for each aircraft.¹ EIA estimates that as of August 16, 2020, consumption of jet fuel by U.S. commercial passenger flights was approximately 612,000 barrels per day (b/d). This volume is 43% of the estimated amount consumed on the same date one year earlier. By contrast, August 16, 2020, consumption compared with year-ago levels was 60% in China (including its Special Administrative Regions Hong Kong and Macau) and 63% in the countries of the Former Soviet Union. U.S. year-on-year consumption is, however, noticeably higher than consumption in Europe (36%), the rest of Africa (31%), the Middle East and North Africa (30%), the rest of Asia (28%), and in the rest of the Americas (24%).

As discussed in greater detail in a previous EIA analysis, differences in the speed and degree of a region’s commercial jet fuel consumption recovery can be attributed to a couple of key factors. First, and probably most importantly, each market’s—and, more specifically, each country’s—exposure and response to COVID-19 has been different, particularly with respect to the timing of the disease’s arrival, the extent of government-required restrictions, and the country’s ability to effectively contain the disease. For example, China’s relatively advanced state of recovery can be primarily attributed to its early exposure to COVID-19 and its relatively strict government controls. China reported its 10,000th case of COVID-19 on January 31, 2020, compared with March 19, 2020, in the United States. Second, regional differences can also be attributed to a market’s reliance on domestic, rather than international, air travel. Because of the less severe restrictions on domestic travel (the U.S. Department of State, for instance, has officially limited or advised against travel with several dozen countries), the shorter distances typically involved, and the larger share of domestic air travel that is non-discretionary, domestic air travel has, in most markets, been relatively less affected by COVID-19 mitigation efforts than international air travel.

Within the United States, the decline in fuel consumption by commercial passenger flights—a category of aircraft that EIA estimates accounted for 73% of total U.S. jet fuel consumption in January 2020—was overwhelmingly driven by a decline in the number of flights. Although an average of 24,900 commercial passenger flights departed U.S. airports each day in January 2020, by July 2020, flight volume had declined to 13,700 per day—51% of the July 2019 level (Figure 2).

Figure 2. U.S. commercial passenger flights (year-to-date 2020)

Changes in the total volume of fuel consumed by U.S. commercial passenger jets have generally tracked changes in the number of flights departing U.S. airports; between January 1, 2020, and August 16, 2020, the two variables maintained an average Pearson correlation coefficient of 0.92 (with 1.00 denoting a perfect, one-for-one positive correlation). Like fuel volumes, the number of U.S. flights has remained low relative to year-ago levels, but has gradually recovered from its lowpoint in late-April and early-May, rising from a year-to-date low of 5,974 flights per day on April 25 to 15,239 flights per day on August 16. The pace of flight cancellations has also largely returned to normal, declining from 12,320 cancellations on March 27 to 128 cancellations on August 16.

The decrease in the overall demand for U.S. commercial passenger flights—and, by extension, jet fuel—has not, however, affected all flights equally, and domestic flights have been relatively more insulated from declines relative to international flights. For instance, estimated U.S. jet fuel consumption by domestic commercial passenger flights fell by 47% between January 2020 and July 2020 compared with a decline of 70% for international flights during the same period (Figure 3). Consequently, the overall share of commercial passenger jet fuel consumed by domestic flights increased from an average of 56% in January 2020 to an average of 69% in July 2020.

Figure 3. U.S. commercial passenger jet fuel consumption by destination (year-to-date 2020)

EIA observed changes in traveler preferences within both of these categories. For instance, the average distance flown per flight has declined in both categories. The distance traveled by domestic flights declined 6% from an average of 893 miles in July 2019 to 843 miles in July 2020, and the distance traveled by international flights declined 25% from 1,498 miles to 1,127 miles during the same period. EIA also observed an apparent shift in the destinations of U.S. travelers flying abroad. For instance, in July 2019 about 38% of all jet fuel used by international commercial passenger flights departing the United States was consumed by Europe-bound flights, but by July 2020 that share had fallen to 21%. At the same time, the share consumed by China-bound flights rose from 18% to 36%, and rest-of-Asia-bound flights rose from 19% to 23%.

Changes in the behaviors of U.S. air travelers have also affected the demand at the regional- and airport-level. Because of their tendency to support relatively more international flights, larger, more coastal U.S. airports have generally experienced a larger and longer-lasting decline in estimated jet fuel consumption than their typically smaller, internally located, and more domestically oriented peers (Figure 4).

Figure 4. Estimated changes in average jet fuel consumption by airport (July 2020 vs July 2019)

EIA’s methodology for estimating the volume of jet fuel consumed by commercial passenger flights has some limitations. Importantly, the estimate does not measure total jet fuel consumption because it does not incorporate either non-passenger cargo flights or general aviation, a category that consists of unscheduled flights such as those made by recreational pilots, helicopters, or travelers on private aircrafts. The estimate also excludes jet fuel consumed by the U.S. military, which, depending on the year and the branch of military service, can be a large amount. For instance, the U.S. Air Force consumed an estimated 142,000 b/d of fuel (most of it jet fuel) in 2019 (or 8% of total U.S. jet consumption), according to the Fiscal Year 2018 Operational Energy Annual Report released by the U.S. Department of Defense.

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¹To estimate changes in commercial passenger jet fuel consumption, EIA uses data from aviation company Cirium that detail each scheduled commercial passenger flight since January 2019, including the type of aircraft flown and its route. Using data on each flight’s origin and destination, EIA calculated the great-circle distance (which measures the straight-line distance between two points along the earth’s surface) for each flight. EIA then increased that distance by 10% per flight to compensate for the excess distance that airplanes fly on average relative to the shortest, optimized path. After factoring in the average fuel efficiency of each flight’s aircraft (including fuel used during takeoff, landing, and taxiing), EIA estimated the volume of jet fuel consumed by each flight and summed these flights to estimate the volume of jet fuel consumed globally by commercial passenger flights.

U.S. average regular gasoline price increases, diesel price falls

The U.S. average regular gasoline retail price increased by nearly 2 cents from the previous week to $2.18 per gallon on August 24, 39 cents lower than the same time last year. The West Coast and Midwest prices each increased more than 2 cents to $2.86 per gallon and $2.07 per gallon, respectively, the Gulf Coast price increased nearly 2 cents to $1.87 cents per gallon, the East Coast increased 1 cent to $2.10 per gallon, and the Rocky Mountain price increased nearly 1 cent to $2.35 per gallon.

The U.S. average diesel fuel price fell less than 1 cent, remaining virtually unchanged from the previous week at $2.43 per gallon on August 24, 56 cents lower than a year ago. The Gulf Coast price fell less than 1 cent to $2.17 per gallon, and the East Coast fell less than 1 cent, remaining virtually unchanged at $2.51 per gallon. The Midwest price was unchanged at $2.31 per gallon. The West Coast and Rocky Mountain prices each increased less than 1 cent, remaining virtually unchanged at $2.96 per gallon and $2.37 per gallon, respectively.

Propane/propylene inventories rise

U.S. propane/propylene stocks increased by 1.5 million barrels last week to 90.8 million barrels as of August 21, 2020, 7.5 million barrels (9.0%) greater than the five-year (2015-19) average inventory levels for this same time of year. East Coast, Midwest, and Rocky Mountain/West Coast inventories increased by 0.8 million barrels, 0.4 million barrels, and 0.3 million barrels, respectively, and Gulf Coast inventories increased slightly, remaining virtually unchanged.