Market evolution: Kerosene (CN 27101921) — 2015–2025

Introduction

This report analyses the evolution of European Union (EU) trade in kerosene (Combined Nomenclature code 27101921) between 2015 and 2025. The analysis is based on annual trade data with non-EU countries, examining shifts in value, volume, pricing, partner concentration, and market volatility. The period under review was marked by significant global events, including the COVID-19 pandemic and the geopolitical reconfigurations following the 2022 invasion of Ukraine, which profoundly impacted energy markets.

1. Sustained Growth in Trade Volumes Amidst Economic Cycles

The EU's kerosene trade exhibited robust long-term growth in both exports and imports, though this trajectory was punctuated by sharp contractions during the pandemic and subsequent price shocks.

1.1. Exports Expanded More Dynamically than Imports

Between 2015 and 2025, the value of EU kerosene exports to non-EU countries surged by 129.0%, rising from €3.84 billion to €8.79 billion. The exported volume grew by 83.6% over the same period, from 6.85 million tonnes to 12.57 million tonnes. Import values also increased, by 63.2% (from €7.36 billion to €12.01 billion), though the rise in imported volume was more modest at 21.3% (from 15.22 million to 18.46 million tonnes). This differential growth significantly narrowed the EU's trade deficit in kerosene.

1.2. The Trade Deficit Persisted but Improved

The EU remained a net importer of kerosene throughout the period. The trade deficit peaked at -€5.91 billion in 2018 but had improved to -€3.22 billion by 2025, a reduction of 8.5% from the 2015 starting point. This improvement reflects the stronger performance of EU exporters on the global stage.

1.3. Prices Followed Global Energy Trends, with a 2022 Spike

Average export prices fluctuated, reaching a minimum of €385.84 per tonne in 2016 and a maximum of €899.39 per tonne in 2022. Import prices showed a similar pattern, with a trough of €341.34/t in 2016 and a peak of €1,082.16/t in 2022. The price surge in 2022 is a dominant feature, coinciding with the global energy crisis triggered by the Russia-Ukraine war. By 2025, prices had moderated but remained 24.7% higher for exports and 34.4% higher for imports than in 2015.

2. Divergent Trends in Partner Concentration and Specialization

The EU's sourcing and destination patterns for kerosene underwent notable shifts, altering the geographic concentration of trade and the relative specialisation of member states.

2.1. Import Sources Became More Concentrated

The Herfindahl-Hirschman Index (HHI) for import concentration by value increased by 68.6%, from 1035 in 2015 to 1745 in 2025. This indicates a market that became less diversified and more reliant on a smaller group of suppliers. Kuwait's share exploded by 473.1% to become the largest single supplier by value (€4.25 billion in 2025), while the United Arab Emirates maintained a top position. Conversely, Saudi Arabia's share fell by 47.0%.

2.2. Export Markets Showed Slightly Less Concentration

In contrast, the HHI for export concentration by value declined slightly by 9.6%, from 2178 to 1968. While still more concentrated than the import market, this points to a modest diversification of export destinations. The United Kingdom became a massively important partner, with exports growing by 277.8%. Notably, exports categorized under "Stores and provisions within the framework of extra-Union trade" also grew significantly, reflecting EU kerosene supply to international aviation.

2.3. Member States Specialised Heavily in Production and Re-export

Analysis of revealed comparative advantage for 2025 shows extreme specialisation in certain member states. Greece, with an RSCA of 0.87, was by far the most specialised, dedicating 9.5% of its product-level exports to kerosene. The Netherlands (RSCA 0.56) and Belgium (RSCA 0.32) were also major specialised players. Conversely, larger economies like Poland and Czechia showed strong negative specialisation (RSCA < -0.94), indicating they are net importers or have negligible export activity in this specific product.

3. Market Turbulence Marked by Pronounced Price Shocks

The 2015–2025 period was characterized by significant volatility, with specific trade flows experiencing severe price shocks that disrupted established patterns.

3.1. Import Partners Exhibited High Volatility

Several key import partners displayed high coefficient of variation (CV) in their trade values, indicating unstable supply relationships. For instance, imports from Kuwait had a CV of 0.89, while those from China had a CV of 0.80. The Russian Federation, despite a smaller share, showed a CV of 0.67. This volatility underscores the susceptibility of EU kerosene supply to geopolitical and market disruptions.

3.2. The 2022 Ukraine War Triggered Major Price Shocks

The most severe market shock occurred in 2022, directly linked to the energy crisis following Russia's invasion of Ukraine. A price shock in exports to Switzerland in 2022 had an abnormality score of 32.1 and a price shift of 53.1%, impacting 33.5% of total export value that year. Simultaneously, imports from Russia experienced a price shock with a 161.5% price increase and an abnormality of 7.4, reflecting the sudden repricing and logistical disruption of Russian energy supplies.

3.3. Structural Shifts in EU Member State Trade

Internally, EU member states' roles evolved. France and the Netherlands consistently dominated import demand, but the fastest growth in export value was seen in Spain (519.0% increase) and France (208.8% increase), suggesting expansions in refining capacity or trading hub activity. Denmark's import value, in contrast, fell by 41.3%.

Conclusion

From 2015 to 2025, the EU kerosene market demonstrated resilience and growth, with exports expanding faster than imports and narrowing the trade deficit. This occurred despite two major disruptions: the COVID-19 pandemic-induced demand collapse and the severe price shocks from the 2022 energy crisis. A key structural change has been the increasing concentration of import sources, particularly towards Gulf states like Kuwait, which raises strategic supply considerations. Meanwhile, EU exports, while still concentrated, have slightly diversified, with the United Kingdom emerging as a paramount partner. The market remains highly sensitive to geopolitical events, as evidenced by the extreme price volatility and shocks recorded in 2022. Future stability will depend on the EU's ability to diversify its kerosene supply chains and the continued integration of member states like Spain and France into global export networks.