Aviation Fuel Market by Fuel Type (Conventional Fuel-Air Turbine Fuel, Avgas, Sustainable Fuel- Biofuel, Hydrogen Fuel, Power-To-Liquid, Gas-To-Liquid), Aircraft Type (Fixed Wing, Rotary Wing, Unmanned Aerial Vehicle) & Region- Global Forecast to 2030
Updated on : March 23, 2023
[257 Pages Report] The aviation fuel market size is expected to grow from USD 249.9 billion in 2022 and is projected to reach USD 696.2 billion by 2030, at a CAGR of 13.7% during the forecast period. Demand to reduce emissions and rising initiatives by governments to adopt sustainable aviation fuel are expected to drive the growth of the market.
Aviation Fuel Market Forecast to 2030
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Aviation Fuel Market Dynamics:
Driver: Demand to reduce emissions
Sustainable aviation fuel (SAF) is a key component in meeting the aviation industry’s commitments to decouple increases in carbon emissions from traffic growth. SAF gives an impressive reduction of up to 80% in CO2 emissions over the lifecycle of the fuel compared to fossil jet fuel, depending on the sustainable feedstock used, production method, and the supply chain to the airport. According to the IATA fact sheet, SAF will be an eligible option for aircraft operators to meet their obligations under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). Production of SAF using biomass, biological, and non-biological resources allows it to be approximately carbon-neutral over its lifecycle. Furthermore, SAF contains fewer impurities (such as sulfur), which enables an even greater reduction in sulfur dioxide and particulate matter emissions than present technology has achieved. While hybrid and electric vehicles are viable alternatives for other transportation needs, electric propulsion on aircraft appears to be several years away when it comes to air travel and is currently limited to small aircraft and medium-range flights. The development of SAF will allow the use of existing aircraft, including long-range models, but with a substantial collective reduction of GHG emissions.
Restraint: Price difference between SAF and conventional aviation fuel
SAF must be competitive both technically and economically, and it must have characteristics similar to traditional jet fuel. All pathways use energy throughout the production process, from hauling feedstock to the production facility to maintaining a safe and healthy work environment to the power required to affect the physical, biological, and chemical processes in the facility on an industrial scale, to delivering the completed fuel product to the distribution infrastructure. Sustainable jet fuel can be produced at USD 0.9/liter to 2.4/liter, depending on the choice of the pathway and the feedstock-to-fuel efficiency. Fossil jet fuel is priced approximately at USD 0.3/liter, the cost of sustainable jet fuel falls within a price range that is roughly 3–9 times higher than conventional jet A-1. Considering that fuel costs make up 30–31% of airlines' operating expenses, an increase in fuel price creates barriers for airline operators to demand sustainable jet fuel. The availability of very limited technologies and infrastructure for the sustainable aviation fuel market also leads to an increase in the total production cost of sustainable aviation fuel. Though SAF has been emphasized as a viable option for carriers to fulfill their obligations under the International Aviation Carbon Offsetting and Reduction Scheme (CORSIA), it is far more expensive than conventional jet fuel. In addition to this, due to political and social crises, there is a surge in the price of jet fuel since 2021.
Opportunity: Growing need for alternative aviation fuel by airlines
The global demand and substantial challenges to reduce emissions of greenhouse gases and improve environmental sustainability in the face of rapid growth have led to the emergence of the SAF market significantly. Several agreements, contracts, partnerships, etc., have been made for a certain period of time by various stakeholders of the entire demand and supply chain of the SAF market. Several airlines have concluded long-term offtake agreements with biofuel suppliers, many of which are reported as commercially competitive. Several airports have agreed to supply SAF through their hydrant systems. This opportunity of offtake agreements between researchers, airlines, airports, fixed base operators, fuel producers, fuel suppliers & distributors, feedstock providers, technology providers, etc., will give immense growth prospects to widen the usability of SAF and provide new visibility to the connected markets as well.
Challenge: High investments for approval and certification of SAF
SAF requires strict technical certifications to be fully approved for utilization in aircraft engines. The entire value chain of the SAF market faces stringent approval procedures for the phases of SAF, for application purposes. However, the involvement of various stakeholders and the quantity of fuel required for the testing parameters add to the cost of the approval of SAF. For instance, the OEM-led ASTM D4054 approval and evaluation process is expensive and time-consuming, which is one of the major hurdles in the growth of the sustainable aviation fuel market.
Along with the existing approved pathways, the newer pathways are still in the approval stages and at different phases. Thus, the overall cost is widely impacted due to the expensive technologies and their approvals that are time-consuming.
Based on fuel type, the conventional fuel segment holds the largest market share in 2022
Increase in air passenger traffic has lead to the rising demand of conventional jet fuel. This demand is greatly created by the various airlines who require jet fuel to run their aircrafts. Although governments are creating initiatives to switch to sustainable aviation fuel, but due to low cost of jet fuel in comparison to SAF, airlines are more dependant on conventional jet fuel. Increase in tourism industry is also leading to the growth of the conventional fuel segment of the aviation fuel market.
North America is expected to account for the largest share of aviation fuel market in 2022
North America is estimated to account for the largest share of the aviation fuel market in 2022. North America is considered to have the largest aircraft fleet with a large number of passengers per year, leading to a substantial increase in aircraft emissions. To cater to the need for a reduction in carbon footprints due to increasing air traffic and air passengers, the US and Canada are focused on various initiatives to utilize sustainable aviation fuel. With supportive policies and initiatives to decarbonize aviation emissions, the North American market is deemed to be one of the strong demand centers for sustainable aviation fuel (SAF). Switching to more energy-dense biofuel to reach the goal of decarbonizing the aviation sector is expected to play a significant role in reducing GHG concentration across the region.
Aviation Fuel Market by Region
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Key Players in the North American Aviation Fuel Market: Analysis and Overview
The aviation fuel market in North America is highly competitive and dominated by key players such as Exxon Mobil Corporation (US), Chevron Corporation (US), and Valero Energy Corporation (US) to name a few. These companies have established strong distribution networks, offer a wide range of products and services, and are investing in sustainable aviation fuel technologies to meet the increasing demand for more environmentally friendly options. The competition in the market is expected to intensify as more companies are entering the market and as demand for sustainable aviation fuels continues to grow.
Key Market Players
Major players operating in the aviation fuel market include Exxon Mobil Corporation (US), Chevron Corporation (US), British Petroleum (UK), Shell (UK), TotalEnergies (France), Neste (Finland), Gazprom (Russia), World Fuel Service (US), Indian Oil Corporation (India), and Valero Energy Corporation (US) among others.
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Report Metric |
Details |
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Market size available for years |
2018-2030 |
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Base year considered |
2021 |
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Forecast period |
2022-2030 |
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Forecast units |
Value (USD) |
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Segments covered |
Fuel Type, Aircraft Type, and Region |
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Geographies covered |
North America, Europe, Asia Pacific, Middle East & Africa and Latin America |
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Companies covered |
Exxon Mobil Corporation (US), Chevron Corporation (US), British Petroleum (UK), Shell (UK), TotalEnergies (France), Neste (Finland), Gazprom (Russia), World Fuel Service (US), Indian Oil Corporation (India), and Valero Energy Corporation (US) among others. |
Aviation Fuel Market Highlights
This research report categorizes the Aviation Fuel Market based on fuel type, aircraft type, and region.
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Aspect |
Details |
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By Fuel Type: |
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By Aircraft Type: |
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By Region: |
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Recent developments
- In August 2022, British Petroleum introduced a next-generation new model all-electric refueller for customers lifting Jet A-1 at Brisbane Airport (Australia). The refueller can carry approximately 16,000 liters of fuel and has been designed to operate for a full day with overnight charging.
- In June 2022, Shell announced the launch of Avelia, one of the world’s first blockchain-powered digital sustainable aviation fuel (SAF) book-and-claim solutions for business travel. It is one of the largest SAF book-and-claim solutions that can offer around 1 million gallons of SAF.
- In June 2022, Exxon Mobil Corporation and Qatar Energy signed an agreement to develop Qatar’s North Field East project, which will expand Qatar’s annual liquified natural gas (LNG) capacity from 77 million tons to 110 million tons by 2026.
- In May 2022, Chevron Corporation partnered with Pertamina to explore potential lower carbon business opportunities in Indonesia.
Frequently Asked Questions (FAQ):
What is the current size of the aviation fuel market?
The aviation fuel market is projected to grow from an estimated USD 249.9 billion in 2022 to USD 696.2 billion by 2030, at a CAGR of 13.7% from 2022 to 2030.
Who are the winners in the aviation fuel market?
Exxon Mobil Corporation (US), Chevron Corporation (US), British Petroleum (UK), Shell (UK), TotalEnergies (France), are some of the winners in the market.
What are some of the opportunities of the aviation fuel market?
Growing need for alternative aviation fuel by airlines and initiatives by governments to reduce tax on aviation fuel are few of the opportunities of the aviation fuel market.
What are some of the technological advancements in the market?
Alcohol-to-Jet (ATJ) technology, Hycogen, and Hybrid Electric Propulsion (HEP), among others.
What are the factors driving the growth of the market?
Demand to reduce GHG emissions, increasing air passenger traffic and rising initiatives by governments to adopt SAF are some of the key factors driving the growth in the market.
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This research study involved the use of extensive secondary sources, including directories; databases; journals on aviation fuel, sustainable aviation fuel, renewable jet fuel, hydrogen fuel, aircraft engine, and other related equipment markets; company newsletters; and information portals such as D&B Hoovers, Bloomberg, and Factiva, to identify and collect information useful for this extensive, technical, market-oriented, and commercial study of the aviation fuel market. Primary sources included several industry experts from core and related industries, OEMs, vendors, suppliers, technology developers, alliances, and organizations. These sources are related to all the segments of the value chain of this industry. In-depth interviews were conducted with various primary respondents, including key industry participants, subject-matter experts, C-level executives of key market players, and industry consultants, among other experts, to obtain and verify critical qualitative and quantitative information as well as assess prospects of the aviation fuel market.
Secondary Research
In the secondary research process, various secondary sources were referred to identify and collect information for this study. Secondary sources included annual reports, press releases, and investor presentations of companies; white papers and certified publications; articles from recognized authors; manufacturers' associations; directories; and databases. Secondary research was mainly used to obtain key information about the industry’s supply chain, the market’s monetary chain, the total pool of key players, market classification, and segmentation according to industry trends to the bottom-most level, regional markets, and key developments from both market- and technology-oriented perspectives. Some other sources included International Civil Aviation Organization (ICAO), International Air Transport Association (IATA), International Energy Agency (IEA), International Renewable Energy Agency (IRENA), Nordic Energy Research, European Union Aviation Safety Agency (EASA), Boeing Commercial Outlook, Federal Aviation Administration (FAA), and General Aviation Manufacturers Association, among others.
Primary Research
Extensive primary interviews were conducted to obtain qualitative and quantitative information such as market statistics, average selling price, market breakdowns, market size estimations, market forecasting, and data triangulation. Primary research also helped in understanding the various trends related to fuel type, aircraft type, and region. Stakeholders from the demand side included aviation fuel suppliers & distributors, airlines, airport operators, aircraft and engine manufacturers, and regulatory authorities & agencies. Interviews were conducted to understand the adoption of sustainable aviation fuel by various airlines and airports to support carbon footprint reduction initiatives.
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Market Size Estimation
Both top-down and bottom-up approaches were used to estimate and validate the size of the aviation fuel market. The following figure offers a representation of the overall market size estimation process employed for the purpose of this study on the aviation fuel market.
The research methodology used to estimate the market size includes the following details:
- Key players in the market were identified through secondary research, and their market shares in respective regions were determined through primary research. The entire procedure included the study of annual and financial reports of the top market players and in-depth interviews for key insights from industry leaders such as CEOs, VPs, directors, and marketing executives.
- All percentage shares, splits, and breakdowns were determined using secondary sources and verified through primary sources.
- All possible parameters that affect the markets covered in this research study were accounted for, viewed in extensive detail, verified through primary research, and analyzed to obtain the final quantitative and qualitative data.
Market Size Estimation Methodology: Bottom-Up Approach
Market Size Estimation Methodology: Top Down Approach
Data Triangulation
After arriving at the overall market size through the market size estimation process explained above, the total market was split into several segments and subsegments. Data triangulation procedures explained below were implemented, wherever applicable, to complete the overall market engineering process and arrive at the exact statistics for market segments and subsegments. The data was triangulated by studying various factors and trends from both the demand and supply sides. Along with this, the market size was validated using both top-down and bottom-up approaches.
Report Objectives
- To define, describe, segment, and forecast the aviation fuel market based on fuel type, aircraft type, and region
- To analyze the degree of competition in the market by identifying various parameters, including key market players
- To identify and analyze key drivers, restraints, opportunities, and challenges influencing the aviation fuel market
- To analyze macro and micro indicators of the market and provide a factor analysis for them
- To forecast the market size of various segments of the aviation fuel market with respect to five major regions, namely, North America, Europe, Asia Pacific, Middle East & Africa and Latin America, along with major countries in each region
- To strategically analyze micromarkets with respect to individual technological trends and prospects of the aviation fuel market
- To strategically profile key market players and comprehensively analyze their market rankings and core competencies
- To track and analyze competitive developments, such as joint ventures, mergers & acquisitions, and new product launches & developments of key players in the aviation fuel market
- To identify detailed financial positions, key products, unique selling points, and key developments of leading companies in the aviation fuel market
- To identify industry trends, market trends, and technology trends currently prevailing in the aviation fuel market
Available customizations
Along with the market data, MarketsandMarkets offers customizations as per the specific needs of companies. The following customization options are available for the report:
Product Analysis
- Product matrix, which gives a detailed comparison of the product portfolio of each company
Regional Analysis
- Further breakdown of the market segments at country-level
Company Information
- Detailed analysis and profiling of additional market players (up to 5)
Growth opportunities and latent adjacency in Aviation Fuel Market
The projected growth of the aviation fuel market is significant and reflects the increasing demand for sustainable aviation fuels and the need to reduce emissions. Government initiatives and regulations will play an important role in driving this growth. It will be interesting to see how the market develops and whether technological advancements will lead to further innovation in sustainable aviation fuel production.