05 July 2012 17:49 [Source: ICIS news]
LONDON (ICIS)--Fundamentals in the European spot jet kerosene market are unlikely to be affected by the rise in passenger numbers from those attending the London Olympic Games later this month.
Airlines have not increased the number of flights coming into London and major UK airports such as Heathrow and Gatwick are already operating at capacity, sources said on Thursday.
It is understood the market will continue to be affected by volatile oil prices and experience some downward pressure from European economic uncertainty despite coming into a traditional busy flying period.
An airline source said there may be some increases of volumes during the Olympics on the fringes such as Southend airport and airlines have the option to bring in larger planes. However, this has not been seen.
A trader said demand for spot jet fuel is less than expected for this time of year.
“The Euro Cup has come and gone and even with a lot of movement around Europe we did not notice any extra jet fuel demand.”
A source also said there could be excess jet kerosene supplies across Heathrow and Gatwick as demand has weakened across the board with travellers avoiding London during the Games.
International Airlines Group (IAG), owners of British Airways and Iberia, said in a statement on Wednesday that there is likely to be some near-term softness in premium traffic due to the Olympic Games.
Figures obtained from Heathrow Airport Limited show they are expecting 59,450 passengers to arrive at Heathrow for the Olympic Games on top of normal passenger numbers.
This is equivalent to a 45% increase on normal traffic on the busiest days of 26 July and 13 August.
A quick survey conducted on Thursday showed that major airlines such as British Airways, Delta, Lufthansa and Qantas all had available flights into London Heathrow on 26 July.
FOB (free on board) barges ARA (Amsterdam-Rotterdam-Antwerp) were at $934.75-936.75/tonne on Wednesday, down slightly from a year-on-year comparison of $1,006.75-1,008.75/tonne.
($1 = €0.80)
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