Global SAF Market's Current Oversupply Expected to Change

Market demand for sustainable aviation fuel rests with global mandates, according to a petroleum data company.

John Kingston

Friday, June 28, 2024 at 05:30 PM ET

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Edited By: tccjeremy

United Airlines is leading a group of companies investing in sustainable aviation fuel. [Credit: Shutterstock]

Key Takeaways:

The global sustainable aviation fuel (SAF) market currently experiences an oversupply relative to demand, primarily in Europe, but this is a temporary situation.
Demand for SAF is projected to significantly outstrip supply by 2035 and beyond, driven by escalating worldwide mandates, particularly the European Union's ReFuel EU program.
While production capacity is expanding through methods like co-refining and alcohol-to-jet technology, current SAF only accounts for 0.1-0.2% of global jet fuel consumption.
A major long-term challenge to meeting future demand is the limited availability and high cost of easily utilized feedstocks, necessitating the development of technologies for alternative sources like municipal waste and agricultural residues.

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The global sustainable aviation fuel (SAF) market is now oversupplied relative to demand, but that is likely to change as various worldwide mandates commence or are widened.

That was one of the key findings from a recent webinar conducted by Argus Media, a leading source of news and pricing data for the petroleum market as well as other commodities. Argus is a global provider of information, so the webinar spanned key markets, from Asia to North America with Europe—which now has the strongest mandates for the use of SAF—in between.