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South America Commercial Aircraft Aviation Fuel Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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  • 100 Pages
  • January 2022
  • Mordor Intelligence
  • ID: 5529969

The commercial aircraft aviation fuel market in South America is expected to grow at CAGR of more than 12% during the forecast period of 2020-2025. The increasing number of air passengers, on account of the cheaper airfare in recent times, stronger economic conditions, and increasing disposable income are few major driving factors for the market. The growing demand for renewable biofuels is likely to drive Aviation Biofuel significantly. However, the recent outbreak of COVID-19 has significantly affected the consumption of aviation fuel in the region. With the closure of international and domestic airlines to curb the spread of the virus, the demand for aviation fuel is expected to decline during the pandemic.

Key Highlights

  • With increasing connectivity globally and decreasing airfares, the commercial sector is increasing the demand for ATF. With a significant share, ATF is leading the market and is expected to dominate the market during the forecast period.
  • South America is one of the leading regions in biofuels. With an increasing shift towards aviation biofuels, significant opportunities are likely to be created in the near future.
  • Brazil is the largest consumer of aviation fuels in South America, resulting in dominance in the region. With a growing market, the nation is expected to continue its dominance during the forecast period as well.

Key Market Trends

ATF to Dominate the Market

  • According to IATA, the air transport market in Chile is forecasted to grow by 78% in the coming years, which would result in an additional 13.2 million passenger journeys by 2037, driving the number of aircraft movements and consumption of ATF in the country.
  • According to IATA, the air transport market in Chile is forecasted to grow by 78% in the upcoming year, which would result in an additional 13.2 million passenger journeys by 2037, driving the number of aircraft movements in the country and demand air turbine fuel.
  • Argentina's aviation industry contributes about 2.1% to the country's GDP (IATA), supported by the air transport sector and foreign tourists arriving. The total number of air passengers to and from different airports in Argentina was at a record high of 20.43 million in 2019.
  • According to Argentina's Ministry of Transport, more than three million passengers have traveled on low-cost airlines until 2019 in Argentina since the country's first budget carrier began operating commercial flights in January 2018. Therefore, as new airlines work to expand in the country in the upcoming years, the market is expected to be driven during the forecast period.
  • Moreover, in Colombia, airlines are increasing their fleet size to carter to total passenger levels, which could reach 100 million by the end of the decade, in turn, promulgating the aviation fuel market in the country.
  • However, due to COVID-19, the market growth is expected to be hampered as there is reduced demand for aviation fuel, which is expected to recover post-2021.

Brazil to Dominate the Market

  • Brazil is one of the largest consumers of aviation fuels in South America. The products specified for use in aircraft in the country are aviation kerosene (QAV), aviation gasoline, and alternative aviation kerosene (alternative QAV).
  • The sales of aviation fuels have remained stable in the past few years, with a monthly average of 3,658.81 thousand barrels for aviation kerosene in 2019 and 25.40 thousand barrels of aviation gasoline sales in the same year.
  • Further, in South America, Brazil is expected to pioneer the development of renewable fuels from sugarcane, which is expected to replace traditional jet fuel. Currently, although there are no specific federal policies in place for sustainable aviation fuel (SAF), initiatives are in place at the state level.
  • Moreover, in 2018, Brazil signed an Open Skies agreement with the U.S. that allows airlines to increase the number of flights between the two countries, in turn having a positive impact on the aviation fuel market.
  • According to the Brazilian Civil Aviation Regulator (ANAC, Brazil), the total number of air passengers in the country in 2019 was 119.39 million, increasing from 107.36 million in 2012. The increase in the number of passengers can be attributed to city-pair connections to and from the country, which is likely to drive the demand for aviation fuel in the country.
  • However, due to COVID-19 pandemic, until the end of 2021, the market studied is expected to be restrained, post which, with increasing passengers and air travel demand, the aviation fuel market is expected to grow for the rest of the forecast period.

Competitive Landscape

The South America commercial aircraft aviation fuel market is moderately fragmented. Some of the major companies include Petroleo Brasileiro S.A., BP PLC, Royal Dutch Shell PLC, Total SA, Repsol SA.

Additional Benefits:

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Table of Contents

1.1 Scope of Study
1.2 Market Definiton
1.3 Study Assumptions
4.1 Introduction
4.2 Market Size and Demand Forecast in USD billion, till 2025
4.3 Recent Trends and Developments
4.4 Government Policies and Regulations
4.5 Market Dynamics
4.5.1 Drivers
4.5.2 Restraints
4.6 Supply Chain Analysis
4.7 Porter's Five Forces Analysis
4.7.1 Bargaining Power of Suppliers
4.7.2 Bargaining Power of Consumers
4.7.3 Threat of New Entrants
4.7.4 Threat of Substitute Products and Services
4.7.5 Intensity of Competitive Rivalry
5.1 Fuel Type
5.1.1 Air Turbine Fuel (ATF)
5.1.2 Aviation Biofuel
5.1.3 AVGAS
5.2 Geography
5.2.1 Brazil
5.2.2 Argentina
5.2.3 Colombia
5.2.4 Rest of South America
6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
6.2 Strategies Adopted by Leading Players
6.3 Company Profiles
6.3.1 Petroleo Brasileiro S.A
6.3.2 Repsol SA
6.3.3 BP PLC
6.3.4 Royal Dutch Shell PLC
6.3.5 Total SA
6.3.6 Pan American Energy S.L.
6.3.7 Exxon Mobil Corporation
6.3.8 Allied Aviation Services Inc