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Market Intelligence & Strategic Sourcing for EN590, Jet Fuel, and SAF – GrainFuel Nexus® Insights

6 min read
17 Mar
17Mar

The global energy markets are at a critical juncture, with geopolitical developments, regulatory frameworks, and shifting trade flows reshaping supply-demand fundamentals. The potential Russia-Ukraine peace deal is expected to impact global crude and refined product markets, altering trade routes and refining margins. 

Meanwhile, the EN590 diesel and Jet A1 markets are navigating tightening refining margins and volatile freight rates, while Sustainable Aviation Fuel (SAF) is entering an oversupply phase in Asia, leading to increasing export flows to Europe.

The global refined fuel markets are currently experiencing heightened volatility due to multiple factors:

  • The Russia-Ukraine peace deal negotiations, which could reshape global diesel (EN590) and Jet A1 supply chains.
  • Asia’s SAF (Sustainable Aviation Fuel) oversupply, which is lowering prices and driving exports to Europe.
  • Fluctuations in freight rates, ship-to-ship (STS) transactions, and tank-to-tank (TTT) deals, impacting procurement strategies.
  • OPEC+ supply adjustments and their effect on Brent-Dubai spreads, influencing regional price dynamics.

EN590, Jet A1, and SAF Market Fundamentals & Trade Modalities

Key Supply & Demand Regions

Fuel Top Producing RegionsKey Demand Markets
EN590 10ppmRussia, Middle East (Saudi Arabia, UAE, Kuwait), Europe (Netherlands, Belgium , and Italy)Europe (Germany, France, Italy), West Africa, Latin America
Jet A1USA, Middle East (UAE, Saudi Arabia, Kuwait), SingaporeUSA, Europe, China, Japan
SAFSingapore, Malaysia, Thailand, JapanEU (Netherlands, Germany, France, UK), USA

The anticipated removal of sanctions on Russian crude could lead to a shift in EN590 and Jet A1 flows back into Europe, potentially reducing prices by $5-$10 per M/T

Trade Modalities & Price Comparisons 

Product
    FOB Rotterdam       - $/MTCIF West Africa 
- $/MT		TTT Rotterdam 
- $/MT		STS Fujairah 
- $/MT
EN590 10ppm500515495502
Jet A1780800770785
SAF1,7001,7501,6801,720
  • FOB transactions remain the most cost-effective for large-scale buyers.
  • CIF contracts are preferred for government tenders but come at a premium.
  • TTT transactions dominate at Rotterdam, Fujairah, Singapore, reducing logistical risks.
  • STS transfers are growing, particularly for Jet A1 trades in Singapore and Fujairah.
  • EN590 buyers in West Africa & Latin America prefer CIF deals to secure supply.
  • Jet A1 traders increasingly use STS at Singapore & Fujairah for intra-Asia trades.

Russia-Ukraine Peace Talks: Potential Market Impact on EN590 & Jet A1

The potential lifting of Western sanctions could trigger the following changes:

  • Urals crude price discount shrinks from $14.50/bbl to $8-$10/bbl, increasing European refinery margins.
  • EN590 exports from Russian refineries (Novorossiysk, Ust-Luga) could resume to European markets, lowering CIF NWE (Northwest Europe) diesel prices by approx. $10/MT.
  • European refiners shift demand away from WTI Midland & Johan Sverdrup crude, weakening Dated Brent vs. Dubai spreads.

However, if sanctions remain, the market will maintain the current trade structure:

  • India & China continue absorbing discounted Russian barrels, sustaining high freight demand from Baltic-Asia trade flows.
  • Middle Eastern refiners (Saudi Aramco, ADNOC) remain the primary suppliers for European Jet A1 & EN590 demand.

Asia’s SAF Oversupply & Implications for Jet A1 Markets

SAF Production vs. Demand Forecasts

Asia’s SAF production is set to exceed regional demand, pushing more exports to Europe:

Year
Asia SAF Production MM/T
Mandated Demand MM/T
Surplus Available for Export
2024
1.24
0.40
0.84
2025
3.5
0.85
2.65
2026
5.0
1.40
3.60

Key Exporters Singapore, Malaysia, Thailand, Japan

Main Buyers EU (Netherlands, Germany, UK), USA With high supply & low mandates, SAF prices are under pressure:

  • Current SAF price in Asia: $1,700/MT (FOB Singapore)
  • Projected Q3 2025 price: $1,500-$1,600/MT

Freight Market & Chartering Trends

Route
VLCC Freight ($/MT)
Handymax Freight ($/MT)
AG-China (VLCC)
9.80
-
AG-Rotterdam (VLCC)
10.50
-
Rotterdam-West Africa (Handymax)
-
40
Fujairah-Singapore (Handymax)
-
36

Recommendations & Strategic Takeaways

For EN590 Buyers:

  • If Russian sanctions ease: Monitor lower CIF NWE diesel prices & optimize storage leasing in Rotterdam.
  • If sanctions remain: Secure FOB Fujairah or CIF West Africa contracts to hedge supply risk.

For Jet A1 Traders:

  • Lock in forward contracts for Asia-Europe trade lanes, anticipating post-OPEC+ supply adjustments.
  • Focus on STS transactions at Fujairah & Singapore for more competitive pricing.

For SAF Market Participants:

  • Utilize Asia’s oversupply & negotiate discounts on FOB Singapore contracts.
  • Monitor EU regulatory developments—mandates will drive higher SAF demand in 2026-2030.

GrainFuel Nexus® stands ready to provide in-depth insights and strategic guidance to clients aiming to capitalize on these emerging opportunities.

GrainFuel Nexus® | Expert Commodity Intelligence & Strategic Advisory


GrainFuel Nexus®

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