Fuel refining and sales fall off cliff

THE LATEST data from the Australian government, released yesterday afternoon, shows that aviation fuel refining and subsequent sales of jet fuel have fallen dramatically, reflecting the serious troubles airlines face with fleets of aircraft grounded due to coronavirus.
Fuel refining and sales fall off cliff Fuel refining and sales fall off cliff Fuel refining and sales fall off cliff Fuel refining and sales fall off cliff Fuel refining and sales fall off cliff

Paul Hunt

Senior Journalist: Energy & Commodities

Paul Hunt

 The Department of Industry, Science, Energy and Resources published its Australian Petroleum Statistics report for April on Tuesday, revealing figures on refining and sales of petroleum products. 

Over the 30-day period only 82.1 mega litres of aviation fuel were refined and produced in Australia, a whopping 65% decrease on the month of March when refineries produced 231.6ML. 

In April 2019 refiners produced 326ML of jet fuel. Last month's production rate is a fall of more than 243ML by comparison. 

The lower refined product was in response to the COVID-19 pandemic which has kept many flights grounded across Australia, with many states maintaining restrictions on travel, which in turn has cut demand. 

It is the lowest level of aviation fuel refined in Australian history since records began. 

Sales unsurprisingly also fell off a cliff. Over the month of April just 153.8ML of jet fuel was sold. 

About 58ML was destined for domestic flights, while the remaining 95ML was for international flights. 

The challenges faced by refiners and the aviation industry were acknowledged on Monday by federal energy minister Angus Taylor when he announced changes to the diesel standard, which governs the quality of diesel used in motor vehicles. 

By reducing the diesel standard by one point, the government can provide a market for an oversupply of aviation jet fuel. 

"This will ease the storage pressures currently being felt by refineries from the drop in demand for fuel products as a result of COVID-19," Taylor said in a statement on Monday. 

Automotive gasoline sales were also down for the month, largely because many workers were required to stay home. 

Total Automotive gasoline sales reached 811ML for April, well down below the 1376ML in March and 1387ML in February.