Dividends and Jet fuel demand sours after brief optimism

If you have been by an airport, it is interesting to spend time watching planes land and takeoff and there are places to watch planes at every airport. You might think of the passengers going somewhere or landing in the place where you are watching; the family reunions; which carrier or the name on the plane is landing; what type of plane and how much jet fuel is needed. Most of us do not think about the jet fuel, but traders in jet fuel do.

In an article by Stephanie Kelly, Koustav Samanta and Bozorgmehr Sharafedin of Reuters they looked at the jet fuel traders or energy traders.

According to Rystad Energy, international flights remain down more than 80% compared to a year ago.

Fuel stocks in Asia have decreased from 4 million barrels in early May to 1.1 in July. The exports come from South Korea, Japan and India. The exports were to Europe. In Europe, according to Dutch consultancy Insights Global, fuel stocks which had set a record of 984,000 tonnes were down to 937,000 tonnes.

Not surprising, the airlines are not carrying holiday travellers and in mid July the week over week rolling 7 day average for passenger growth in the US fell below 0 for the first time since April 20.

Jet fuel imports to the US in July increased to 190,000 barrels per day, still 45,000 bpd under year ago data, but up 33,000 from June.

Linking to dividend paying stocks, we all look at great amounts of data, but you need to narrow your focus and concentrate on to make a decision. At the moment, if you look at airports, airport traffic, airline companies and what they are doing, it is easy to see there has been a drop in passenger traffic. Often times we are looking connections between what we see, what we think we know, and what is really happening. When there is a boom or a bust, we all know what is happening, but what if there is something in between? where do you look, homework is important.

There are more questions than answers, till the next time – to raising questions.

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