Nato pipeline access keeps Alkagesta's European jet fuel moving

Aviation fuel supply in Europe has been one of the most closely watched parts of the barrel this year, and a Cold War-era pipeline network has turned into one of its quiet stabilisers. In an interview with The National, Malta-based commodity trading house Alkagesta set out how access to the Nato Central European Pipeline System (Ceps) has allowed it to move from cargo trading into direct jet fuel supply to airlines at a moment when Gulf barrels were largely unavailable.

The company was admitted to the pipeline system only days before the Iran conflict began, according to the report. Built in the 1950s to fuel Nato forces, the roughly 5,000km network links refineries, depots, ports and airfields, and today carries mostly jet fuel to both military and commercial hubs. Its multiple entry and exit points are what make it valuable to a trader: barrels bought in north-west Europe can be delivered inland without depending on coastal barge or truck movements. That pipeline access sits alongside the firm's wider storage footprint across Europe and Asia.

Turning a supply shock into a supply role

After the closure of the Strait of Hormuz, jet fuel exports from the Gulf fell by around 80 per cent in March, part of a wider disruption that removed more than 10 million barrels per day from global supply. Alkagesta's trading desk had already been tracking the consequences for middle distillates in its market commentary, including its assessment of the Hormuz blockade and its earlier note on the shape of the supply disruption itself.

"In this crisis we have managed to turn the risk into opportunities," Asad Huseynov, the company's managing director of investments and assets, told The National on the sidelines of the S&P Global Energy Middle East Petroleum and Gas Conference in London. He described an airline approaching the company after its existing supplier said it was short of jet fuel: "We have managed to find him fuel at the volume that he needed."

Mr Huseynov said the company now holds contracts with two holiday airline operators, which he declined to name. Fuel is bought from refinery suppliers in north-west Europe — including Exxon, Vitol and Petroineos, counterparties the firm says it has worked with for many years — then shipped through the pipeline to customers at airports in Brussels, Frankfurt and elsewhere in Germany, where airport tank farms store it before it is pumped into aircraft.

A lengthy admission process

Access was not quick. Mr Huseynov described a lengthy application requiring a detailed business plan, with only a limited number of new customers admitted each year. "You have to explain why you want to do X tonnes from this entry but less on another entry, and why you want to take it to this airport," he said — a level of operational planning that draws on the same logistics discipline and risk controls the company applies elsewhere in its book, and on the credit lines that support prompt cargo purchases.

The move also marks a change in business model. Previously a cargo trader moving products between counterparties rather than selling into end markets, Alkagesta has spent 2026 widening its activity: a first crude oil transaction, additional biofuel storage capacity at Antwerp, and expanded jet fuel volumes set out in its first-half performance update and subsequent press coverage. Its participation in the IATA aviation energy discussion this year pointed in the same direction.

Volumes and outlook

Alkagesta expects to trade 100,000 tonnes of jet fuel this year and believes the European market will stay steady even as the continent shifts towards renewable alternatives — an area the firm covers through its lower-carbon fuels activity. "In terms of the annual jet fuel sales, we're planning to increase it several times," Mr Huseynov said. "So I think it was a really good decision for us to enter this market."

The wider European picture has eased since the spring. Higher regional refinery runs, drawdowns from stocks and imports from the United States and Nigeria have offset much of the lost Middle Eastern supply — a rebalancing consistent with the gasoil and distillate trends the company has tracked through the summer. Air France-KLM has said its jet fuel supply is secure for the summer, Lufthansa reported no signs of supply risk at its six European hubs, Ryanair's chief executive said supply appears secure until September, and Jet2 does not expect disruption to its summer schedule.

For traders, the episode is a reminder that in a constrained market the decisive advantage is rarely price alone. It is access — to pipelines, to tankage, to counterparties — and the operating governance needed to use it. More on the company's trading activity is available at Alkagesta.