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Jet Fuel Pricing Outlook and Key Drivers

Jet Fuel Pricing Outlook and Key Drivers. Paul Cluett Global Sales Co-ordination Manager. To Cover. Oil and Jet Fuel Trends Future issues and concerns Key Drivers. World Oil Supply/Demand Balance (million b/d). Total OECD Jet Demand. Total OECD Jet Demand. OPEC Basket Price. $/bbl.

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Jet Fuel Pricing Outlook and Key Drivers

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  1. Jet Fuel Pricing Outlook and Key Drivers Paul Cluett Global Sales Co-ordination Manager

  2. To Cover • Oil and Jet Fuel Trends • Future issues and concerns • Key Drivers

  3. World Oil Supply/Demand Balance(million b/d)

  4. Total OECD Jet Demand

  5. Total OECD Jet Demand

  6. OPEC Basket Price $/bbl 34 32 Daily Basket Price 30 28 OPEC Price Band 26 24 22 20 Day Average 20 18 Data to 25 March 16 2- 27- 25- 21- 16- 11- 6- 4- 2- 28- 23- 17- 12- 8- 5- 1- 26- 21- 16- 11- 2- Jan- Feb- Apr- Jun- Aug- Oct- Dec- Feb- Apr- May- Jul- Sep- Nov- Jan- Mar- May- Jun- Aug- Oct- Dec- Feb- 01 01 01 01 01 01 01 02 02 02 02 02 02 03 03 03 03 03 03 03 04

  7. OPEC Basket Price in Euro Euro/bbl 34 * OPEC Price Band calculated with Euro/Dollar rate at time of OPEC Basket introduction 32 30 OPEC Price Band * 28 26 24 22 Daily Basket Price 20 20 Day Average 18 Data to 25 March 16 2- 27- 25- 21- 16- 11- 6- 4- 2- 28- 23- 17- 12- 8- 5- 1- 26- 21- 16- 11- 2- Jan- Feb- Apr- Jun- Aug- Oct- Dec- Feb- Apr- May- Jul- Sep- Nov- Jan- Mar- May- Jun- Aug- Oct- Dec- Feb- 01 01 01 01 01 01 01 02 02 02 02 02 02 03 03 03 03 03 03 03 04

  8. Selective World Jet Fuel Prices Far East Nuclear Power Plants Today… Extreme Cold Oil Price Wars 9/11

  9. OECD Product Stocks million b/d 1850 1999 1800 1750 1998 1700 2002 1650 2001 1600 2004 1550 2000 2003 1500 1450 Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

  10. Airline Trends • RPK - Revenue passenger km • ASK - Available seat km • FTK – Freight tonne km • ATK – Available tonne km • PLF – Passenger load factor

  11. Issues and Concerns • Fragile Airline Finances and Airline Bankruptcies. • Limited Hedging cover by airlines. • Low Sulphur Diesel and Squeeze on Jet production. • Infrastructure and Investment. • Environmental developments. • Tax. • Deregulation & New competition. • Airport congestion and slots.

  12. Key Drivers of Jet Fuel Pricing • Jet Price levels – High at present • will they continue at current levels?. • No more shocks Sars/Iraqi etc. • Supply Security. • Low stocks & refinery reliability. • Better Demand Forecasting. • Passenger Confidence.

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