SAF gains new urgency as Middle East tensions expose jet fuel supply risks

Rising jet fuel prices and supply chain risks stemming from Middle East energy disruptions are drawing renewed attention to sustainable aviation fuel, or SAF. Long discussed primarily as a tool for cutting carbon emissions in the aviation sector, SAF is increasingly being reframed as an energy security strategy to reduce dependence on volatile jet fuel supplies.

The shift in thinking took center stage Tuesday at the 2026 Seoul Biofuels and SAF Media Conference, held at the Four Seasons Hotel Seoul in Jongno-gu, where SAF market expansion and the need for bioethanol-based jet fuel production technology were the main topics. The event was jointly organized by the US Embassy in Seoul, the Korea Biofuel Forum and the US Grains Council.

High oil prices and supply chain instability lie behind the aviation industry's growing focus on SAF. Jet fuel prices have remained elevated since the recent energy supply crisis in the Middle East. While crude oil prices rose roughly 50 percent compared to pre-war levels, jet fuel prices nearly doubled.

Markets have since shown some signs of stabilization after the United States and Iran signed a memorandum of understanding on June 17 to end the conflict. Supply chain vulnerabilities remain unresolved, however, as refinery capacity has declined in some developed countries even as jet fuel demand recovers.

Kim Ju-ho, fuel supply chain manager at the International Air Transport Association, said the recent Middle East energy crisis had driven jet fuel prices sharply higher. "Although things have calmed somewhat, jet fuel prices are still at quite elevated levels," he said.

Kim said that beyond its environmental benefits, what matters most for SAF is supply stability and price stability. "Policy development must continue so that SAF can achieve both supply stability and price stability," he said.

Against this backdrop, discussions around SAF and biofuels are expanding beyond green industry promotion into supply chain strategy. The SAF market, however, remains in its early stages. Global SAF output is estimated at less than 1 percent of total jet fuel consumption. The cost burden is also significant — SAF prices in the European market are roughly three times those of conventional jet fuel, and costs passed on to airlines through suppliers under blending mandates have been cited at as much as four times the conventional price.

"The SAF market is still at a very early stage," Kim said. "SAF production accounts for less than 1 percent of total jet fuel consumption." He added that output would need to increase substantially for the market to mature.

Securing SAF feedstock is another critical challenge. Most commercial SAF today is produced through the HEFA process, which refines used cooking oil and animal fats into jet fuel. But used cooking oil is already in demand from other industries, including biodiesel, limiting how much supply can be expanded. As SAF demand picks up in earnest, concerns are growing that feedstock prices could rise and shortages could emerge at the same time.

That has put the spotlight on alcohol-to-jet, or ATJ, technology — a process that converts bioethanol derived from corn, sugarcane and other crops into jet fuel — as an alternative. The United States and Brazil already have large-scale bioethanol production infrastructure in place, making them better positioned to provide a stable feedstock supply than sources dependent on used cooking oil.

Emerson Warrenburg, energy consulting director at S&P Global, said biofuel policy originally grew out of energy security concerns and the need to address agricultural oversupply. "More recently, the addition of low-carbon fuel and decarbonization policies is changing the character of the market," he said.

Major economies such as the United States and Brazil have built up biofuel policies to reduce dependence on oil imports and leverage their agricultural base, and the recent addition of carbon reduction mandates is broadening applications into transportation, aviation and shipping, he said.

Erin Heitkamp, vice president at Gevo, a US bioenergy company pursuing the commercialization of bioethanol-based SAF, also stressed the scalability of the ATJ pathway. She said used cooking oil feedstocks alone would not be sufficient to meet future SAF demand, and that ATJ — which can draw on abundant feedstocks and existing ethanol production infrastructure — is best positioned to fill the supply gap.

"The aviation industry is growing faster than other sectors, but it has few decarbonization options beyond liquid fuels," Heitkamp said. "To fill the projected SAF shortfall, multiple ATJ projects need to reach a final investment decision within the next few years."

Sang Byung-in, a chemical engineering professor at Hanyang University, noted that South Korea produces almost no crude oil but excels in refining and petrochemical capacity. "Jet fuel in particular ranks among the top one or two export products by global export volume," he said. The outlook for whether South Korea can build competitive technology in sustainable aviation fuel, however, "is not entirely bright at this point," Sang said.

Sang said simply importing SAF or blending some bio-feedstocks into existing refinery processes would not be enough. While HEFA and co-processing methods based on used cooking oil offer a relatively accessible entry point, their feedstock and process constraints mean South Korea needs to explore a range of technology pathways over the long term, including bioethanol-based ATJ, he said.

He was particularly concerned that relying solely on imported SAF feedstocks could limit the energy security benefits. South Korea should also consider developing the technology to produce ethanol from domestically available but underutilized biomass and convert it into SAF feedstock, he said.

"From an energy security standpoint, we cannot simply import all the ethanol or alcohol from abroad — we also need to develop the technology to produce ethanol from domestic, underutilized biomass," Sang said. "We can gradually start thinking about how to secure ethanol with energy security in mind."

Policy predictability is another variable that will determine the level of private investment. Because SAF production facilities require large-scale capital outlays, they need institutional backing — long-term demand signals, stable pricing, tax incentives and blending mandates. Airlines need clear government roadmaps before committing to long-term purchase agreements, and refiners need them before investing in new capacity.

South Korea is pushing to mandate SAF blending for international flights starting in 2027. Domestic refiners and airlines are under pressure to accelerate the development of SAF supply chains and secure the necessary certifications. Given that SAF prices remain higher than conventional jet fuel, the risk that costs will be passed on to airlines and ultimately consumers cannot be ruled out.

The shipping sector is also seeing growing discussion around biofuel adoption. Quaim Chowdhury, senior engineer at the American Bureau of Shipping, said tightening carbon regulations from the International Maritime Organization are expanding the potential role of alcohol-based marine fuels such as methanol and ethanol. With shipbuilders and engine manufacturers accumulating experience with methanol-powered vessels, ethanol-based marine fuel could emerge as a new market in the years ahead, he said.

"The shipping industry already has experience using methanol as a fuel," Chowdhury said. "Ethanol fuel can also be applied technically without much difficulty, and if shipowners and operators choose it, the industry is ready to accommodate that."