(Bloomberg) -- Jet fuel is piling up at airports on the East Coast as the pandemic is keeping U.S. traveler traffic at less than half usual levels.
Twice this month, the weekly buildup of jet fuel kept mostly at airport storage tanks has surpassed 2 million barrels. Increases this high hadn’t happened before at any point during the pandemic. Most of the added jet fuel is on the East Coast, which includes the New York area’s three largest airports.
The airline industry has been the weakest link in the recovery of fuel consumption that was decimated when the pandemic first hit last year, robbing refiners of one of their biggest customers. Things may get worse for aviation fuel as the Biden administration vows tough enforcement of safety travel measures, including self-quarantine for people arriving from other countries.
In the week ending Jan. 15, 2.16 million barrels of jet fuel were added to stockpiles for a total of 39.5 million, the highest since October, Energy Information Administration data show. That came after 2.26 million were added in the week ending Jan. 1.
The supply glut is forming as the number of passengers through U.S. airports has slumped to about 16.7 million people this year through Thursday, compared with more than 40 million over the same span in 2020 and 2019, Transportation Security Administration data show.
Houston and New York jet fuel cash prices have been trading 10 cents per gallon or more below diesel futures for the lowest seasonal value in decades, according to data compiled by Bloomberg.
On top of the jet fuel accumulating in airport tanks and the pipelines that supply them, a large amount is also being added to diesel storage facilities to help the industry manage the load.
That has caused diesel stockpiles to hit their highest since October last week even as demand for the trucking fuel is boosted by online shopping deliveries across the country.
The U.S. is currently storing one barrel of jet fuel for every four barrels of diesel.