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(I-TravelNewswire.Com, December 18, 2019 ) Market Overview:
The global Aviation Fuel market size is expected to grow at a CAGR of just under 12 % during the forecast period (2019-2026).
Aviation fuel is a specialized type of petroleum-fuel used to power aircraft. It is generally of a higher quality than fuels used in less critical applications, such as heating or road transport, and often contains additives to reduce the risk of icing or explosion due to high temperature, among other properties.
Most current commercial airlines and military aircraft use jet fuel for maximum fuel efficiency and lowest cost. Aviation fuel generally arrives at the airport via pipeline systems, such as the CEPS. It is then pumped over and dispensed from a tanker. The fuel is then driven up to parked aircraft and helicopters. Some airports have pumps similar to filling stations to which aircraft must taxi. Some airports have permanent piping to parking areas for large aircraft.
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Increase in the global middle-class population, growing demand for a global passenger traveling and increase in the no of air crafts are the crucial factors driving the market growth. Aviation fuel market has seen a considerable increase in passenger air travel globally. In the last six years, the aviation industry has witnessed a rise in more than 6% of global air passenger travel demand. Developing countries such as China, India, and Indonesia are expected to be the fastest growing markets regarding additional annual passengers by 2036. As per the study of International Air Transport Association (IATA), there are around 7.8 billion passengers who are expected to be traveling by 2036, which is almost double the number in 2017 globally.
Price of crude oil still dropping to around USD 53.50 and rising income of the middle class is aggressively motivating many low budget carriers’ companies to serve the passengers well. Low oil prices have been a significant contributor to recent growth in air transportation. With aviation, fuel costs running at around a third of overall airline costs, passing on the lower oil prices to the customers in the form of lower ticket costs have certainly contributed to the strong performance.
Stringent regulations and rise and fall in oil & gas prices are the restraints hampering the growth of the market globally. Global government strict environmental policies in reducing carbon footprint through airways are a major restraint for the market growth. The prices of crude, the main factor determining the cost of aviation fuel has drastically come down in recent days. This growth can again decline as the prices of the crude oil rise over the coming years.
Based on the type of aviation fuel it is categorized as Jet Fuel A, A-1, and Jet B and Biofuel. Jet Fuel A-1 is the standard fuel with commonly used all over the world. Jet A is the fuel type which is usually used in the United States and major airports in Canada. Jet Fuel B is the fuel with Naptha-kerosene in it and is mostly used in cold countries. It is an alternative fuel to Jet A-1, as Jet A-1 is difficult to handle high flammable conditions. Airline companies are using alternative fuels such as biofuel to cope with environmental concerns. For instance, In August 2018 Spicejet Airline Company took off from Dehradun to New Delhi propelled with the mixture of Bio-Diesel and Aviation fuel.
Based on the application type, the aviation fuel is categorized as commercial, defense, and others. Commercial aircraft segment is further divided into cargo aircraft and passenger aircraft. Commercial aircraft held the major share in the consumption of aviation fuel due to the large mobility of passengers traveling worldwide in the year 2018. Defense aircrafts segment holds the next highest share in the consumption of Aviation fuel as they are governed and owned by various federal state governments and private companies of each country. Defense is anticipated to witness a positive impact on aviation fuel market growth over the next few years. Defense consumes a large amount of aviation fuel. High conventional fuel cost led the defense to face huge expenses which forced to invest in aviation fuel.
The North America Aviation Fuel market size was worth USD XX billion in 2018 and is forecasted to reach USD XX billion by 2026, at a CAGR of XX% during the forecast period. Investments from US governments on aviation fuel for their defense department is helping the development of the aviation fuel market in North America. The U.S. Department of defense shows the utmost demand for aviation fuel, hence it is allotting huge sums of money for testing and adoption of aviation fuels. In recent years, emissions norms being strict for airlines operating companies which have shown interest towards alternative jet fuel was trending majorly in developed economies like US and Canada where they tried using bio jet fuel last year replacing conventional ones.
Asia Pacific region is expected to hold the maximum share in the forecast period due to major developing economies like China & India which are increasingly urbanizing, thus leading to strong demand for Aviation fuel market growth. New Infrastructure developments leading to better connectivity in the air travel sector in the nations of Asia Pacific especially in China, India, Singapore, and Indonesia led to increasing in the air travel passengers, in turn driving the demand for Aviation fuel. Increase in the middle-class population majorly in the Asian countries will lead to a rise in the consumption of more Aviation fuel supporting the growth of the Aviation fuel market. For instance, according to the OECD – Organisation for economic co-operation and development, the size of the global middle class will increase 4.9 billion by 2030.
Air BP, Shel, Exxon Mobil, Chevron Corp, Gazprom, Total SA, and IOCL are the key market players in Aviation Fuel Market globally.
Major aviation fuel companies in the world have gone through a rough phase as prices of oil fluctuated very much the prices of the fuel showed a continuous increase which led to the intense competition between different low budget carriers & premium carrier airlines.
Industry players are developing new fuel technologies in the Aviation fuel market. For instance, In November 2018 Japan's biotechnology company Euglena started mass production of the bio jet fuel and biodiesel derived from algae and waste oil, being the first company to fuel green commercial flights out of Japan.
In November 2017, Shell aviation announced that it has signed a fuelling concession agreement to operate the new into-plane and fuel farm facilities as the sole jet fuel supplier at Salalah International Airport in Oman.
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