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The aviation fuel market size is forecast to increase by USD 109 billion, at a CAGR of 8.55% between 2023 and 2028. The market experiences significant growth due to multiple driving factors. Firstly, there is an increasing emphasis on clean aviation fuel as a means to reduce carbon emissions and mitigate environmental concerns in the aviation industry. Secondly, the demand for air travel continues to rise, fueled by factors such as economic growth, increasing disposable income, and the convenience and speed of air travel. Lastly, the military sector is witnessing a surge in the use of Unmanned Aerial Vehicles (UAVs), which require a substantial amount of fuel to operate, thereby contributing to the market's expansion. These factors collectively create a favorable environment for the growth of the market. It also includes an in-depth analysis of market trends and analysis, market growth analysis , and challenges. Furthermore, the report includes historic market data from 2018 - 2022.
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The market encompasses various fuel types, including Aviation Turbine Fuel (ATF) and Aviation Gasoline, catering to commercial aviation, defense aviation, and general aviation sectors. Fossil fuels continue to dominate the market due to their widespread use in conventional fueled aircraft. However, the environmental concerns arising from greenhouse gas emissions have led regulatory bodies to encourage the adoption of biofuels. The risks of icing in flying routes pose challenges to air passenger travel, necessitating the development of efficient and aerodynamic aircraft. Fuel consumption is a significant operating expense for aircraft manufacturers, influencing strategic mergers and the expansion of customer bases. The emergence of electric aircraft presents an opportunity to reduce fuel costs and mitigate environmental impact. The market dynamics are shaped by factors such as fuel prices, technological advancements, and government regulations. Our researchers analyzed the market research and growth data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Increasing focus on clean aviation fuel is a key factor driving market growth. The global aviation industry is experiencing a significant shift towards alternative fuels, driven by the volatility of fossil fuel prices, the necessity for energy security, and increasing emissions. Aviation Turbine Fuel (ATF) and aviation gasoline are the primary fuels used in commercial aviation, defense aviation, and general aviation. With the depletion of fossil fuel reserves and the growing concern for sustainability, biofuels have emerged as a viable solution. Regulatory bodies, such as those in European nations with Euro-VI emission norms, are driving the adoption of renewable fuels like ethanol and biodiesel.
Furthermore, technological advancements in biofuels are shaping the Middle East aviation market, offering sustainable alternatives like cellulosic ethanol and algae-based biofuels. These innovations reduce dependency on traditional feedstocks like sugarcane and soybean, enhancing scalability and environmental benefits. Investment in infrastructure for feedstock cultivation and refining facilities is pivotal for scaling up biofuel production in the region. The Middle East's strategic position as a global aviation hub underscores the importance of adopting such technologies to meet growing air travel demand sustainably. Despite challenges such as icing risks and high operational costs, initiatives like electric aircraft and strategic partnerships between manufacturers and fuel providers are gaining momentum. Evolving environmental regulations further emphasize the market's commitment to reducing carbon emissions and enhancing fuel efficiency, driving advancements in aviation biofuels within the Middle East aviation sector.
The launch of new aviation fuel technology is a major trend in the market. The Market encompasses the production and supply of fuels, including Aviation Turbine Fuel (ATF) and aviation gasoline, for use in commercial aviation, defense aviation, and general aviation. Traditional fuels, primarily derived from fossil sources, have long been the backbone of this industry. However, with the increasing global population and the need for more sustainable solutions, there has been a significant focus on the adoption of biofuels in aviation. Regulatory bodies have played a crucial role in driving the transition towards biofuels. T
Moreover, echnological advancements in production processes, such as Honeywell's UOP eFining technology and ethanol-to-jet fuel (ETJ) processing technology, have enabled the conversion of various feedstocks, including corn-based, cellulosic, and sugar-based ethanol, into sustainable aviation fuel (SAF). SAF, also known as eFuels or electrofuels, is a class of synthetic fuels that can replace petrol-based fuels in airplanes and aircraft. These advanced biofuel technologies offer several advantages, including increased efficiency, reduced greenhouse gas emissions, and improved sustainability. The scalability of production and investment in infrastructure, including feedstock cultivation and refining facilities, are essential factors in the growth of the market during the forecast period. The aviation industry, which includes air passenger travel, proliferating businesses, short-distance travel, and flying routes, faces numerous challenges, including environmental regulations and the risks of icing.
Fluctuations in oil and gas prices is a significant challenge in the market. The aviation industry's reliance on fossil fuels, specifically Aviation Turbine Fuel (ATF) and aviation gasoline, is inextricably linked to the price of crude oil. Commercial aviation, defense aviation, and general aviation sectors have been impacted by the prolonged period of low crude oil prices since July 2014. This price decline, attributed to a supply-demand imbalance, has significantly affected the revenues and cash flow of upstream oil and gas companies. Meanwhile, the downstream sector has experienced reduced operating costs due to the decreased price of crude oil. Aviation fuel, primarily used in airplanes and aircraft, has become more affordable, benefiting both airlines and passengers.
However, the use of petrol-based fuels raises concerns regarding environmental regulations and sustainability. Regulatory bodies worldwide are encouraging the adoption of biofuels as a viable alternative to fossil fuels. Technological advancements in production processes, feedstock options, and the efficiency of biofuels have made advanced biofuel technologies, such as algae-based and cellulosic biofuels, increasingly scalable. Investment in infrastructure, feedstock cultivation, and refining facilities is essential for the widespread implementation of biofuels in the aviation sector. Therefore, these factors are anticipated to pose a major challenge to the market growth during the forecast period.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.
Market Customer Landscape
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 aviation fuels such as jet fuel, avgas, UL91, and sustainable aviation fuel.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market share growth by the commercial segment will be significant during the forecast period. The Market encompasses the production and distribution of Aviation Turbine Fuel (ATF) and Aviation Gasoline (AvGas) for various sectors, including commercial aviation, defense aviation, and general aviation. Fueled by the expanding global population and rising disposable income, the demand for air travel has surged, propelling the growth of this market since 2021. Commercial aviation has been the primary segment driving market expansion due to the post-pandemic recovery and the increasing number of air passengers.
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The commercial segment was the largest segment and was valued at USD 98.60 billion in 2018. Major aircraft Original Equipment Manufacturers (OEMs) have responded by revamping their production facilities to meet the scheduled deliveries. Low-Cost Carriers (LCCs) are modernizing their fleets to capitalize on new market opportunities. Fossil fuels, such as petrol-based fuel, continue to dominate the market. However, the shift towards sustainable alternatives, including biofuels, is gaining momentum due to technological advancements and regulatory pressures. The production processes for biofuels involve various feedstock options, such as sugarcane, corn, and algae, which offer efficiency and scalability. Advanced biofuel technologies, like cellulosic and algal biofuels, are being explored for their potential to reduce the carbon footprint of the aviation industry. Investment in infrastructure, including feedstock cultivation and refining facilities, is crucial for the sustainability and growth of the biofuel segment during the forecast period.
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APAC is estimated to contribute 42% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional market growth and trends that shape the market during the forecast period. Another region offering significant growth opportunities to vendors is North America. The market in North America experiences significant growth due to increased investments in aircraft systems for new commercial aircraft, driven by rising global demand and expanding living standards. These investments lead to reduced fuel costs and the production of innovative designs with efficient engines, enhancing revenue generation for the aviation industry.
In addition, the energy content of aviation fuel is crucial, as aircraft weight and configurations vary among types and models. Aircraft manufacturers prioritize the development of lightweight materials and advanced engine technologies to optimize fuel consumption. Despite the increasing air traffic, particularly in the US, challenges persist, including airport infrastructure limitations and the need for accommodating growing passenger numbers. Nevertheless, the market's potential for revenue growth remains substantial, with disposable income levels continuing to rise and the ongoing advancements in aircraft production and fuel efficiency.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
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The market is a significant sector within the global energy industry. Aviation fuel is an essential component in powering aircraft, making its supply a critical factor in the aviation industry's operations. The market caters to the demand from various aviation sectors, including commercial aviation, conventional fuelled aircraft military aviation, and general aviation. The market is driven by several factors, including the increasing number of air passengers, research and development efforts, growing air freight traffic, and expanding aviation fleets. Additionally, the ongoing modernization of aircraft fleets and the adoption of more fuel-efficient technologies contribute to the market's growth.
Further, the market is diverse, with various types of fuels used, such as Jet A, Jet A-1, and Jet Fuel. These fuels differ in their properties and applications, with Jet A being the most commonly used fuel for commercial aviation. The market faces challenges, including the volatility of crude oil prices and the need to reduce carbon emissions. To address these challenges, industry players are focusing on research and development of alternative fuels and improving fuel efficiency. In conclusion, the market plays a vital role in powering the aviation industry and is influenced by various factors, including demand from different aviation sectors, customer base, fuel types, and market challenges.
Market Scope |
|
Report Coverage |
Details |
Page number |
176 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 8.55% |
Market growth 2024-2028 |
USD 109 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
7.68 |
Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
Performing market contribution |
APAC at 42% |
Key countries |
US, China, Germany, India, and Canada |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
BP Plc, Chevron Corp., Exxon Mobil Corp., Gazprom International Ltd., Gevo Inc., Honeywell International Inc., LanzaTech Global Inc., Marathon Petroleum Corp., MOL Group, Neste Corp., Oil and Natural Gas Corp. Ltd., Petroleo Brasileiro SA, PJSC LUKOIL, Shell plc, SkyNRG BV, Swedish Biofuels AB, Targray Technology International Inc., TotalEnergies SE, Valero Energy Corp., and Vitol Netherlands Cooperatief UA |
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, Market condition analysis for market 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. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Product
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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