Multiple analysts and industry trade sources indicate that South Korean refiners' aviation fuel exports for May have rebounded to levels seen before the outbreak of conflict in Iran, supported by a recovery in crude oil imports and robust refining margins.
As a major refined product exporter in Asia, the significant recovery in South Korea's aviation fuel exports, with increased spot bulk shipments, has effectively alleviated market concerns about tight supply and substantially lowered aviation fuel prices in the Asia-Pacific region.
Over the past two weeks, the spot premium for aviation fuel has plummeted by 50%, falling to approximately $2 per barrel. In March, this premium had surged past $20, reaching a historic peak.
Data from Kpler, Vortexa, and traders shows that South Korea's aviation fuel exports for May ranged between 1.1 and 1.2 million metric tons (equivalent to 8.67 to 9.46 million barrels), the highest level since August of last year.
Kpler data indicates that May exports surged by 36% compared to April's low for the year. So far this year, South Korea's aviation fuel shipments account for 30% of total aviation fuel imports in the Asia-Pacific region, a significant increase from the 23% share for the full year 2025.
Data from London Stock Exchange Group (LSEG) shows that, in addition to the sharp decline in the aviation fuel spot premium, the grade differential between low-sulfur (10ppm) diesel and aviation fuel has shifted from a premium to a slight discount.
Military actions by the US and Israel against Iran led to a de facto blockage of the Strait of Hormuz, a passage for one-fifth of global crude oil shipments. The resulting crude supply disruptions initially reduced operating rates at Asian refineries.
The head of Asia-Pacific analysis at Vortexa stated that South Korea's crude oil imports in May have recovered to about 80% of pre-disruption levels. Due to increased refinery throughput, he anticipates South Korea's aviation fuel exports will grow month-on-month in June.
A senior analyst at FGE-NexantECA estimated that South Korean refiners' average crude processing volumes for May and June will be higher than April's, reaching 2.4 million barrels per day or more, though still below the pre-conflict operating rate of 2.9 million barrels per day. Official South Korean data shows the country's refining throughput was 2.18 million barrels per day in April.
Kpler data shows that as the world's fourth-largest crude importer, South Korea's crude arrivals fell to 1.51 million barrels per day in April, the lowest since 2013, before rebounding to 2.27 million barrels per day in May, with imports primarily sourced from Saudi Arabia, the United States, and the United Arab Emirates.
Kpler data indicates that one-fifth of South Korea's total aviation fuel exports in May were shipped to the United States, and traders predict export volumes will remain steady in June.
Vortexa analysts note that current inter-regional arbitrage opportunities favor South Korean refiners shipping aviation fuel to the US West Coast, which may incentivize refiners to increase production and expand exports.
According to institutional calculations, since late May, the US West Coast aviation fuel swap price has been more than $20 per barrel higher than the Asian market price, whereas the differential was only $10 per barrel two weeks prior.
Shipping data from SSY, part of the London Stock Exchange Group (LSEG), indicates that the shipping cost for approximately 300,000 barrels of refined products on this route is $7 per barrel.
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