European SAF Premiums Decline as Jet Fuel Prices Surge Amid Middle East Conflict

Premiums for sustainable aviation fuel (SAF) in Europe have declined as conventional jet fuel prices surged following the escalation of conflict in the Middle East. While SAF prices have also increased, they have risen at a slower pace than fossil-based jet fuel, reducing the price gap between the two.

Jet fuel prices in Europe have climbed sharply-rising by around 80% since late February 2026-driven by supply disruptions and increased freight costs linked to the conflict. At the same time, SAF prices rose from approximately $2,294 per metric ton to around $2,640, but their premium over jet fuel narrowed significantly.

The shift is partly attributed to logistical challenges, including higher shipping costs and rerouting of fuel shipments due to risks in key maritime routes such as the Red Sea. Europe, which relies heavily on SAF imports, has faced longer shipping distances and increased transport costs as suppliers avoid high-risk zones.

The narrowing price gap between SAF and conventional jet fuel could influence the economics of aviation decarbonisation. While SAF remains more expensive, the reduced premium may improve its competitiveness in the short term, even as broader volatility in energy markets highlights the challenges of transitioning to sustainable fuels amid geopolitical uncertainty.

The narrowing SAF-versus-conventional-jet-fuel premium during the Middle East conflict period illustrates how geopolitical energy shocks can shift the relative economics of alternative fuels. When conventional fuel prices rise rapidly, the effective SAF cost premium narrows even if SAF absolute prices also rise - improving the near-term competitiveness of sustainable fuel adoption.

The pattern also highlights supply-chain vulnerability. European SAF import dependence combined with Red Sea shipping-route disruption reveals the physical infrastructure that alternative-fuel supply requires. Rerouting adds cost and complexity that can partially offset any competitive advantage gained from higher conventional fuel prices.

For airlines, fuel producers, corporate travel buyers and financial institutions supporting aviation decarbonisation, Cognitud's climate action, supply chain and operations and market intelligence teams help clients evaluate SAF sourcing opportunities across shifting price dynamics, structure fuel-procurement strategies robust across geopolitical scenarios, and prepare disclosures aligned with CORSIA, CDP Transport and jurisdictional aviation-sustainability frameworks that increasingly determine competitive positioning in European travel markets.