Kerosene Market Intelligence, Analysis, and Forecast — Recent Commodity Market Dynamics

I. Market Intelligence
(A) Price Trends
1. National Average Market Price: From April 15 to 23, 2026, the national average price of kerosene across mainstream markets exhibited a volatile downward trend. On April 15, the average price stood at RMB 7,227.75 per ton; it declined to RMB 7,152 per ton on April 16—a drop of 1.05%; rebounded slightly to RMB 7,157 per ton on April 17 (+0.07%); plunged sharply to RMB 6,821 per ton on April 20 (–4.69%); fell further to RMB 6,787 per ton on April 21 (–0.5%); dropped to RMB 6,732.75 per ton on April 22 (–0.8%); and edged down to RMB 6,722.75 per ton on April 23 (–0.15%).
2. Regional Price Disparities: The Yangtze River Delta and Pearl River Delta—key aviation fuel distribution hubs—exert marginal pricing power. Wholesale prices in East and South China are RMB 120–180 per ton higher than those in inland regions.
3. Coal-to-Liquid (CTL) Fuel Prices in Ningxia: As of April 24, the prevailing transaction price for CTL diesel in Ningxia was RMB 7,350 per ton, down RMB 100 per ton; the mainstream transaction range remained stable at RMB 7,340–7,360 per ton. The prevailing transaction price for CTL naphtha was RMB 6,900 per ton, with a mainstream transaction range of RMB 6,890–6,910 per ton.

(B) Supply-Demand Conditions
1. Supply Side
– Domestic kerosene production has grown steadily, reaching 41.2 million tons in 2023, with capacity utilization maintained at approximately 88%, resulting in a near-tight supply-demand equilibrium. Accelerated commissioning of private integrated refining & petrochemical projects—including Hengli Petrochemical and Zhejiang Petrochemical—has raised kerosene yield to 18–22%, enhancing supply capability for premium aviation fuel markets.
– Global kerosene output in 2023 totaled ~210 million tons, with the Asia-Pacific region accounting for 38% (China alone contributing 25%), the Middle East 22%, and Europe 18%. Refining capacity concentration is increasing: the world’s top ten refiners control 45% of global crude distillation capacity.
2. Demand Side
– Aviation turbine fuel (jet fuel) constitutes the core component of kerosene consumption, representing over 75% of total demand; its fluctuations decisively influence the overall market. In 2023, China’s apparent jet fuel consumption recovered to ~32.4 million tons—approaching 2019 levels—but growth markedly decelerated. With the progressive implementation of low-altitude economy policies under the “14th Five-Year Plan,” emerging application scenarios—including general aviation and drone logistics—are injecting new growth momentum into the kerosene market.
– Industrial kerosene demand shows steady growth, particularly in coatings, resins, and solvents. However, China’s “Dual Carbon” (carbon peak & carbon neutrality) policy drives industrial substitution away from kerosene: industrial kerosene demand declined by 2.3% year-on-year in 2023.
– Civilian-sector demand remains relatively stable, retaining irreplaceable advantages in remote areas and emergency lighting applications, sustaining consistent market demand.

(C) Key Influencing Factors
1. International Crude Oil Prices: Fluctuations in international crude oil prices directly impact the kerosene market. Recently, escalating geopolitical tensions in the Middle East have tightened global oil supply, pushing benchmark Brent crude prices toward the USD 110/barrel threshold—elevating kerosene production costs. Nevertheless, amid crude price volatility, persistent geopolitical risks, and seasonal weakness in domestic gasoline/diesel demand, kerosene prices may continue trending downward in the short term.
2. Policy Factors: National authorities attach high priority to energy structure optimization, promoting clean energy and low-carbon economic development—profoundly affecting the kerosene market. Stricter environmental regulations impose higher quality standards on kerosene products, prompting enterprises to increase R&D investment and enhance product quality. Government policy aims to reduce kerosene’s share in primary energy consumption by expanding renewable and clean energy use, thereby decreasing reliance on conventional fuels. Furthermore, the EU’s “Fit for 55” initiative mandates sustainable aviation fuel (SAF) to constitute 6% of aviation fuel by 2030 and 70% by 2050—exerting indirect influence on China’s kerosene market.
3. Technological Advancements: Sustainable aviation fuel (SAF) development and deployment represent an emerging industry trend, offering significant carbon emission reductions to meet aviation’s environmental requirements. Global SAF production capacity is projected to reach 3 million tons/year by 2025, with production costs falling to USD 1.5–2.0 per liter—approaching parity with conventional kerosene. Regarding hydrogen substitution, Japan and Germany are piloting “green hydrogen + kerosene” co-combustion technologies, targeting a 10% blend ratio by 2030.

II. Analysis and Assessment
(A) Causes of Recent Price Volatility
Recent kerosene price volatility stems from the combined effects of international crude oil prices, supply-demand dynamics, and policy factors. Rising international crude prices elevate production costs—supporting kerosene prices. Yet domestic gasoline/diesel demand remains subdued during the seasonal off-peak period, limiting demand growth. While industrial substitution pressures and stable civilian demand contribute to relatively loose supply-demand conditions, restraining price increases, policy-driven energy restructuring and tightening environmental compliance also exert downward pressure on prices.
(B) Supply-Demand Balance Assessment
Domestic kerosene supply and demand remain broadly in tight equilibrium, albeit subject to uncertainties arising from international developments and policy shifts. Jet fuel demand benefits from aviation recovery and expansion into novel applications but faces moderating growth rates. Industrial kerosene demand rises in select sectors (e.g., coatings, resins) yet confronts substitution headwinds; civilian demand remains stable. On the supply side, domestic output continues growing steadily, and private integrated refining projects bolster supply capacity, while import dependency remains consistently low.
(C) Industry Competitive Landscape
China’s kerosene market features a “state-owned enterprise (SOE)-led, private enterprise-supported” competitive structure. State giants—including Sinopec and CNPC—dominate the market through scale advantages and brand strength. Private firms, leveraging technological innovation and agile market strategies, have secured meaningful market shares—focusing on niche segments or specialized product categories—and achieved rapid growth via differentiated competition.

III. Forecast
(A) Price Trend Forecast
In the short term, kerosene prices may continue exhibiting volatile downward movement, influenced by international crude price fluctuations, geopolitical risks, and seasonal softness in domestic gasoline/diesel demand. However, as the Spring Festival holiday concludes and downstream enterprises resume operations, kerosene demand is expected to gradually recover—limiting further downside. Long term, robust global aviation sector growth and continuous emergence of novel applications will sustainably drive jet fuel demand, providing solid support for the kerosene market. Concurrently, the advancement of green fuels such as SAF will steer the industry toward greater environmental sustainability—contributing to long-term price stability.
(B) Supply-Demand Relationship Forecast
Future kerosene supply-demand dynamics will be shaped by multiple variables. On the demand side, jet fuel demand will persistently grow; industrial kerosene demand will expand in certain sectors while facing substitution challenges; civilian demand will remain stable. On the supply side, domestic output is expected to rise further, with private integrated refining projects enhancing supply capacity, and import dependency remaining low. Overall, supply-demand balance will generally hold, though periodic episodes of tightness or slack may occur.
(C) Industry Development Trend Forecast
1. Green Transformation: Heightened environmental standards and energy structure optimization will accelerate kerosene industry greening. Adoption of green fuels—including SAF—will continuously expand, prompting enterprises to intensify investment in green technology R&D and production, advancing sustainable industry development.
2. Premiumization: Growing jet fuel demand and rising performance requirements will propel the kerosene industry toward premiumization. Enterprises will ramp up R&D efforts to improve product quality and performance, developing high-end kerosene variants to meet evolving market needs.
3. International Expansion: With the Belt and Road Initiative progressing and global energy transition accelerating, Chinese kerosene enterprises will expedite overseas market deployment. Through technology transfer, project partnerships, and other modalities, they will enhance international competitiveness and contribute Chinese solutions to global energy transformation.