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The Defense Aircraft Aviation Fuel Market size is estimated to increase by USD 17.07 billion and grow at a CAGR of 5.81% between 2022 and 2027. Market growth hinges on several factors, notably the expanding utilization of military UAVs, heightened demand for long-range and heavy-payload military aircraft, and augmented investments in the defense sector by multiple nations. Challenges confronting the market encompass fluctuations in crude oil prices, a surge in the adoption of fuel cells, and constraints in the availability of sustainable fuel sources.
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This report extensively covers market segmentation by product (air turbine fuel (ATF), aviation biofuel, and others), application (surveillance aircraft, civil aircraft, and others), and geography (North America, APAC, Europe, South America, and the Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
The air turbine fuel ATF segment will account for a major share of the market's growth during the forecast period. ATF is a crucial component in the global market. Such fuel shall be used to drive military aircraft, such as fighter jets, transport planes, and helicopters. The aviation fuel market for defense aircraft is a crucial sector, playing an important role to ensure the readiness of military forces worldwide.
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The air turbine fuel ATF segment was valued at USD 25.86 billion in 2017 and continued to grow until 2021. ATFs are designed to take into account the demanding requirements of Military Aircraft such as High Pressure and High Temperature. It has low flash points and a high energy density, making it the most suitable fuel to use in modern military aircraft engines. It is also designed to tolerate extreme weather conditions, which is essential for aircraft used in military operations. In addition to its functional benefits, ATF is also crucial for national security.
Application Segment Analysis:
Based on application, the market has been segmented into Surveillance aircraft, Civil aircraft, and others. The global market is seeing a surge in demand for surveillance aircraft. By gathering intelligence and surveillance data, such aircraft are playing an important role in the defense sector. The surveillance aircraft segment is expected to grow significantly in the coming years due to increasing security concerns across the globe. The surveillance aircraft segment includes manned surveillance aircraft and combat reconnaissance aircraft.
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North America is estimated to contribute 34% to the growth by 2027. Technavio’s analysts have elaborately explained the regional trends, drivers, and challenges that are expected to shape the market during the forecast period. Aviation fuel research and development infrastructure are also well-developed in the region. Two of the major organizations that carry out research in this field are the Defense Advanced Research Projects Agency (DARPA) and the US Air Force Research Laboratory (AFRL). They are working on cutting-edge fuel technologies that could improve the performance and efficiency of military aircraft.
North America is home to a number of significant aviation fuel manufacturers in addition to these research institutions. These include ExxonMobil Corp. (ExxonMobil), one of the largest suppliers of aviation fuel to the US military, and Chevron Corp. (Chevron). These companies put a lot of money into developing novel fuel technologies to meet the specific needs of military aircraft. Chevron USA, for instance, in September 2021. The announcement of a partnership between Gevo, Inc. (Gevo), a subsidiary of Chevron Corp., and Inc., a subsidiary of Chevron Corp., to process unpalatable corn into sustainable aviation fuel in order to lower the lifecycle carbon intensity of aviation fuels. During the forecast period, market growth will be boosted by these factors.
Our analysis of the adoption life cycle of the market indicates its movement between the innovator’s stage and the laggard’s stage. The report illustrates the lifecycle of the market, focusing on the adoption rates of the major countries. Technavio has included key purchase criteria, adoption rates, adoption lifecycles, and drivers of price sensitivity to help companies evaluate and develop growth strategies from 2022 to 2027.
Global Market Customer Landscape
The market is witnessing significant growth driven by increasing defense spending and the demand for fuel-efficient engines. With the aerospace and defense fuel market value on the rise, jet fuel remains a crucial component for various aircraft. To ensure higher quality and safety, fuel additives are utilized to mitigate risks such as explosion, icing, and high temperatures. Petroleum fuels cater to different engine types, including jet turbine engines, automotive/generator engines, and diesel engines. Various types of aerospace and defense fuel, including Avgas, aviation gasoline, and kerosene-based blends, serve the diverse needs of commercial aircraft and internal combustion engines. Quality testing is essential to maintain standards and ensure optimal performance across different applications, including railroad engines. Our researchers studied the data for years, with 2022 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.
The surging utilization of military UAVs is fueling the expansion of the market. Unmanned aerial vehicles (UAVs) are witnessing increased adoption across various military applications, ranging from surveillance and reconnaissance to critical missions. Their integration into defense operations aims to streamline military activities, enhancing efficiency and security on the battlefield. Consequently, the demand for aviation fuels, including jet fuel, is witnessing an upswing to support the operations of these UAVs. Moreover, geopolitical tensions between nations are further propelling the demand for UAVs, thus driving the growth of the defense aircraft aviation fuel market. This trend underscores the vital role of aviation fuel in sustaining military operations and security efforts worldwide.
The increase in demand for jet fuel is a primary trend in the market. The rising number of military aircraft has resulted in an increase in demand for jet fuel. This increase in demand continues to have a significant impact on the aviation fuel industry. The need for jet fuel has been consistently rising as more countries around the world invest in their air forces. Military aircraft require a considerable amount of jet fuel for their operations. The geopolitical climate in various parts of the world has prompted countries to increase their military capabilities. The rising tensions between nations have enforced the need for more advanced military aircraft. As a result, there has been a considerable increase in demand for jet fuel as more nations invest in their defense capabilities.
Moreover, the aviation fuel industry has had to adapt to meet the increasing demand. Refineries have had to increase production levels to meet the fuel requirements of the military. The companies are leveraging new technologies, turning resources such as domestic garbage, alcohol, carbon from the atmosphere, and sewage into jet fuel on a commercial scale, promising emissions savings of more than 70% when compared to traditional fossil jet fuel. Thus, the above-mentioned factors are expected to propel the adoption of jet fuel, which is expected to fuel the growth of the global market during the forecast period.
The fluctuation in crude oil prices is a major challenge for the market. The oil price is a determining factor for aviation, with the success or failure of its operation depending on what it fetches. The price of crude oil has been decreasing for a long time since July 2014. The prices have declined continuously due to a supply-demand imbalance. The revenues of upstream oil and gas companies have decreased, which has directly affected their cash flow. For the downstream sector, the cost of raw materials, crude oil, was reduced, which decreased their operating cost substantially and increased the profit margin for companies.
However, volatility in crude oil prices is a major risk for airlines. As a result of higher oil prices, the cost of petroleum input increases for the upstream sector and this leads to an increase in airfares. Moreover, during the phase of low crude oil prices, operating costs for the aviation industry were reduced. With the drop-in aviation fuel prices, air carriers' profitability is increasing and their fares are falling. As a result, the demand for air travel grew and this led to an increase in airline capacity. The decrease in crude oil prices has reduced the focus on investments in alternative aviation fuels. Such factors can hinder the growth of the global market during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
BP Plc - The company offers defense aircraft aviation fuel such as Jet A-1.
Chevron Corp. - The company offers defense aircraft aviation fuel through its subsidiary GS Caltex.
We also have detailed analyses of the market’s competitive landscape and offer information on 15 market players, including:
Technavio report provides an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies vendors into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Vendors are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The market is experiencing significant growth driven by factors such as increasing defense spending, demand for fuel-efficient engines, and the value of the aerospace and defense fuel market. Fuel additives play a crucial role in ensuring higher quality and stability, especially in environments with high temperatures and potential hazards like explosions and icing. Various types of fuels, including Avgas, Mogas, and unleaded kerosene, cater to different engines such as turbine engines, Spark plugs, and compression ignition engines. The market benefits from the demand for commercial aircraft, with airlines seeking lower-cost options and synthetic fuels to reduce carbon emissions. Robust supply chains support the production and distribution of aviation fuels, meeting the needs of both defense and commercial sectors.
The market continues to thrive, driven by various factors. Petroleum fuels remain integral, powering jet turbine engines, automotive/generator engines, and diesel engines. Aviation gasoline and motor gasoline cater to internal combustion engines, while safety and predictable performance are paramount for military vehicles and cars alike. Quality tests ensure reliability across Wankel or reciprocating engines, and naphtha-kerosene blend and gasoline-based aircraft fuel sustain aviation operations. The market benefits from lower costs, enabling cheaper airlines to flourish amid rising demand for aircraft and passenger traffic. With a large, established aviation industry and prominent defense contractors, supported by a robust supply chain, the market embraces alternative fuels like renewable aviation fuel to meet evolving needs, including those of fleets of air force aircraft.
Defense Aircraft Aviation Fuel Market Scope |
|
Report Coverage |
Details |
Page number |
161 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 5.81% |
Market growth 2023-2027 |
USD 17,077.63 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
5.34 |
Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
Performing market contribution |
North America at 34% |
Key countries |
US, China, Japan, Germany, and France |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
BP Plc, Chevron Corp., Exxon Mobil Corp., Gevo Inc., Honeywell International Inc., Indian Oil Corp. Ltd., LanzaJet Inc., Marathon Petroleum Corp., MOL Group, Neste Corp., Petroleo Brasileiro SA, PJSC LUKOIL, Repsol SA, Shell plc, SkyNRG BV, Swedish Biofuels AB, TotalEnergies SE, Valero Energy Corp., Vitol Netherlands Cooperatief UA, and World Fuel Services Corp. |
Market dynamics |
Parent market analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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