Jet fuel demand is forecast to double at Tokyo’s Haneda airport as the Japanese government adds 40 slots for international flights, according to a survey of four local refining officials.
Sales of bonded jet fuel, or tax-exempted aviation petroleum sold only for overseas flights, may increase by as much as 600,000 kiloliters at Haneda to 1.2 million kiloliters, said the officials from local oil refiners and fuel suppliers who asked not to be identified, citing company policy.
The increase in jet fuel sales may buffer falling demand for most oil products in Japan. The country’s total fuel consumption will drop an average of 1.8 percent annually through March 2018, the Ministry of Economy, Trade and Industry said in a report in June.
“Amid slowing domestic oil demand, it is very gratifying for Japan’s oil industry to see increasing Haneda slots boosting jet fuel demand,” Satoru Yamamura, the Tokyo-based international sales manager at TonenGeneral Sekiyu K.K., said in an e-mail. “I hope the 2020 Olympic Games will add more jet fuel demand.”
Tokyo will host Japan’s fourth Olympics in 2020. That follows the Tokyo summer games in 1964 and the winter games in Sapporo in 1972 and Nagano in 1998.
The government plans further additions before the 2020 event, Transport Minister Akihiro Ohta told reporters on Sept. 10, according to a transcript posted on the minstry’s website.
First-month swaps for jet fuel in Singapore, Asia’s biggest oil-trading center, fell 60 cents to $121.70 a barrel on Oct. 4, according to PVM Oil Associates, a broker. The fuel’s swaps dropped 6.9 percent between Aug. 29 and Sept. 24 to $120.20 a barrel.
TonenGeneral, Japan’s second-biggest refiner by capacity, operates the 335,000 barrel-a-day Kawasaki plant across the river from Haneda airport, Tokyo’s largest.
Japanese refiners sold 7.4 million kiloliters of bonded jet fuel to airlines such as Japan Airlines Co. and ANA Holdings Inc. in the fiscal year ended March 2013, according to data compiled by the Petroleum Association of Japan. A gain of 600,000 kiloliters accounts for 8.1 percent of total sales.
Japan’s transport ministry distributed 31 slots on Oct. 2 for daytime outbound routes starting at the end of March at Haneda airport, just outside Tokyo’s main business district. The allocation includes 16 slots for the two local carriers, and the ministry is continuing negotiations with the U.S. and other countries on how to divide the remaining nine.
The expansion is a part of Japan’s plan to boost landing and takeoff slots at Haneda and Narita, 70 kilometers (40 miles) east of Tokyo, to 750,000 annually by the year ending in March 2015 from the current 680,000, according to the ministry.