What Happens When 20% of the World's Exported Jet Fuel Vanishes | WSJ

TL;DR

The US-Israel war on Iran has closed the Strait of Hormuz, cutting off 20% of global jet fuel and triggering an unprecedented energy crisis.

Key Points

• 1.The Strait of Hormuz closure is a historic energy shock. The strait normally routes 20% of global seaborne jet fuel and 15 million barrels per day of crude and refined products; its effective closure due to the US-Israel-Iran conflict is described as the largest energy crisis in history.
• 2.Europe has roughly six weeks of jet fuel reserves, but hedging softens the blow for now. EasyJet, for example, hedged 70% of its fuel needs for H2 2026 at $706 per metric ton — less than half the current market rate — though that protection will erode as supplies dwindle.
• 3.The US West Coast is uniquely vulnerable despite America's domestic refining strength. About 85% of its imported jet fuel comes from South Korea, which itself depends on Gulf crude; US carriers largely don't hedge fuel costs, prompting some budget airlines to seek $2.5 billion in emergency federal support.
• 4.Asia is already rationing supply, and full market recovery could take 6–18 months. China stopped all jet fuel exports (roughly 15% of global seaborne supply), hitting Myanmar and Vietnam hardest; restarting the system involves 5–6 weeks of shipping, refining lags, and damaged infrastructure even if the war ended today.