Jet fuel has become one of the more immediate supply-chain costs to watch as the Iran conflict keeps pressure on Gulf energy flows and aviation routings.
The latest market signal is mixed but not calm. The International Air Transport Association’s fuel monitor said the global average jet fuel price fell 1.7% last week to $159.85 a barrel. In the U.S. Gulf Coast market, Energy Information Administration data showed kerosene-type jet fuel at $3.817 a gallon on May 26, down 11.8% from $4.328 on May 19 but still above mid-April levels. The EIA’s weekly Gulf Coast series was $4.113 a gallon for the week of May 22, about 10.9% higher than the week of April 17.
For air cargo buyers, that kind of move matters even when base rates are stable. Major express and air freight providers typically adjust fuel surcharges against published jet fuel benchmarks. FedEx, for example, says its package and express freight surcharge calculations for many air services are based on weekly jet fuel prices, including the U.S. Gulf Coast spot price for kerosene-type jet fuel.
The risk is not just the pump price. IATA said April air cargo demand rose 4.0% year over year, but the same release pointed to a tougher operating environment: severe disruption at major Gulf hubs, constrained capacity on key corridors and sharply higher fuel costs. IATA said Middle Eastern carriers posted an 18.2% year-over-year drop in air cargo demand in April, with capacity down 22.9%.
That puts logistics teams in a narrow lane. Air freight often absorbs urgent inventory moves when ocean or trucking networks are disrupted, but Gulf routing and fuel uncertainty can make that safety valve more expensive. Dedicated freighters carried much of April’s growth, according to IATA, which suggests shippers are still using air cargo to keep parts, electronics, pharmaceuticals and other time-sensitive goods moving despite higher costs.
The practical question for shippers is timing. Fuel surcharge tables can lag spot-market changes, and contracts vary by carrier, lane and customer agreement. A late-week dip in jet fuel does not necessarily remove a surcharge increase already built into a forwarder’s quote or a carrier’s published table. If Hormuz risk keeps crude and refined-product markets jumpy, air cargo budgets may see the impact before procurement teams can renegotiate service levels.
Forwarders and shippers should review three items now: whether quotes include fuel as a separate line item, how often surcharge tables reset, and which benchmark drives the calculation. For emergency freight, the cheapest option may be avoiding a panic move: pre-clearing alternative routings, splitting replenishment orders and deciding which SKUs genuinely need air uplift.
The market has not produced a simple shortage story. It has produced a pricing and planning problem, and jet fuel is the part of the air cargo bill most exposed to another Gulf shock.