SAF strategy for energy security

opinion

by Fayaz Hussain

May 4, 2026

Sustainable Aviation Fuel has a worldwide opportunity like never before. Conflict in the Gulf and fears about jet fuel shortages in Europe offer an opportunity to assert SAF’s credentials as a safe, clean and, above all, secure source of aviation fuel. A source that can never be held hostage to geopolitics or blockages on the Strait of Hormuz.

“Global aviation has access to sustainable and abundant feedstocks that simply aren’t subject to this kind of volatility: agricultural residues, captured CO2, industrial waste gases – all of which remain underutilised,” says Conor Madigan, CEO of eSAF producer Aether Fuels.

Until now, SAF has been promoted as a clean fuel to combat climate change. But now, an even more powerful, immediate and persuasive argument is at hand: energy security.

Fears of jet fuel shortages – particularly in Europe – have been well reported. Lufthansa claims it was forced to cancel 20,000 flights last week due to jet fuel shortages. Ryanair has slashed its schedule by half and SAS is warning that dwindling fuel supplies will inevitably drive airfares higher.

Airports Council International (ACI) Europe, representing 600 airports over 44 countries, has informed the European Commission that a systemic jet fuel shortage is imminent unless passage through the Strait of Hormuz resumes.

“The past weeks have exposed weaknesses in the EU’s refining capacity and our dependency on imports. This only reinforces the urgency of doubling down on EU and national support for decarbonisation through the production of Sustainable Aviation Fuels,” says ACI Europe’s director general Olivier Jankovec.

The continuing energy crisis has uncovered an uncomfortable truth: the aviation sector rests on a single fossil fuel supply chain. Nearly 50% of Europe’s jet fuel imports come from Gulf. The benchmark European jet fuel price recently hit an all-time high of $1,838 per tonne, compared with $831 before the current conflict escalated.

“What we are seeing now is a reminder of how exposed Europe remains to global fuel shocks,” says Mads Brandstrup Nielsen, senior vice president communication, Public Affairs & Sustainability, SAS.

Madigan, from Aether Fuels believes SAF offers the secure alternative to fossil fuels. “In the long run, scaling SAF production from these [domestic] sources is how the industry builds genuine resilience against future oil shocks,” he tells us.

“But it won’t happen without long-term offtake agreements, binding targets, and de-risked early-stage production. These are what move SAF from a premium add-on to a structural part of how aviation reduces its exposure to fossil and geopolitical volatility,” Madigan adds.

The defence may have the solution for this. It is now leading where commercial aviation has hesitated. “The former head of the US Army said energy is the lifeblood of the military. And we need to think of, do we have enough of this lifeblood?” Dirk Janssen, partner at law firm Watson Farley and Williams tells SAF Investor. Dirk has overseen multiple SAF deals and represents the firm at eSAF coalition Project SkyPower.

Aviation accounts for approximately 85% of liquid fuel demand within military operations. During the Gulf War in 1991, the US burned in a single day equivalent of ten times Poland’s entire daily fuel use in 2025. The scale of dependency is enormous.

The EU currently has strategic fuel reserves for 90 days in a crisis scenario. Janssen says these are “dangerously insufficient”. And unlike civil aviation, which can reduce operations as we have seen already, military cannot wait for supplies. Defence planners are looking for alternatives.

In March this year, US Department of Defence invested $65m in US eSAF startup Air Company. German defence contractor Rheinmetall has partnered with eSAF producer Ineratec to develop what they are calling GigaPTX. This is a modular, load-flexible e-fuel production plant that can be deployed across Europe.

“When you’re starting to tackle energy resilience more comprehensively, you don’t just want to produce the fuels in Europe – you actually want to make sure those fuels are produced in an off-grid, robust and highly distributed way,” Ineratec chief commercial officer Maximilian Backhaus tells SAF Investor.

This energy security imperative is driving procurement conversations beyond contractors. Max adds they are having “weekly discussions with ministries of defence, with supranational institutions like NATO, with strategic planners” across EU to install local solutions for e-fuels predominantly eSAF.

The push from defence addresses two obstacles that have historically prevented SAF market from scaling: the high cost of early-stage production and the absence of long-term offtake agreements.

“The military thinks from a strategic point of view and not from a short-term monetary aspect. They need to get their jets flying. In the civil sector the problem we have is that eSAF is more expensive than normal kerosene and that long-term offtakers are missing to make projects bankable. Now the military can fill this gap by saying, we are your reliable offtakers,” says Janssen.

He adds that as defence procurement scales production volumes, unit costs fall, and those lower costs benefit civilian producers too. The dynamics on offtake are equally convincing.

Peace time military demand runs at roughly 20% of a crisis scenario. The surplus SAF, if designed for dual use, can make its way into civilian market. This provides long-term revenue certainty which private investors have struggled to find.

Conflict in Ukraine and now in the Gulf has forced governments around the world to re-examine the security of their energy policies – not least for aviation fuel. SAF, produced domestically from locally-sourced feedstocks or via power-to-liquid pathways using renewable energy, is likely to feature increasingly in those calculations.