India made history by exporting its first-ever jet fuel cargo to the U.S. West Coast for energy giant Chevron, as reported by trade sources and shipping data. This move capitalized on a unique arbitrage opportunity to address supply shortages in Los Angeles. Production of jet fuel on the U.S. West Coast has been limited since October due to a fire at Chevron's El Segundo refinery, prompting the company to shut down multiple units.
Approximately 60,000 metric tons (equal to 472,800 barrels) of aviation fuel were loaded onto the Panamax tanker Hafnia Kallang between October 28 and 29 at Jamnagar port. Data from Kpler, LSEG, and four trade sources revealed that this transaction involved Reliance Industries, the operator of the refinery at that port. The ship was chartered by Castleton Commodities and is expected to reach Los Angeles in the first half of December, as confirmed by multiple shipbrokers.
To maintain confidentiality, all sources preferred to remain anonymous, with both Reliance Industries and Castleton Commodities refraining from making any official comments. Chevron, on the other hand, declined to discuss commercial matters but indicated that repairs on the El Segundo jet fuel production unit would likely be completed by early 2026. As a result, the supply of jet fuel on the U.S. West Coast may face constraints until the refinery repairs are finished, according to insights from two trade sources.
Despite Chevron's commitment to meeting its global customer demands, including those served by the El Segundo refinery, the company noted its flexibility to utilize either local or imported products for this purpose. Nonetheless, industry experts doubt that frequent jet fuel imports from India to the U.S. West Coast will become a regular occurrence, as shipments from Northeast Asia currently offer a more cost-effective option. Shipping costs for transferring around 40,000 metric tons of refined fuels from South Korea to the U.S. West Coast have remained stable at approximately $40 per ton since October, as indicated by SSY pricing data.
Usually, information on spot shipping rates between India and the U.S. West Coast is not readily accessible due to the rarity of this route. Recent data from Kpler tracking shipments revealed that jet fuel exports from Northeast Asia to the U.S. West Coast reached a five-month peak of around 600,000 tons in the previous month. The strong arbitrage economics persist, given that U.S. West Coast jet fuel prices stand at $10 per barrel above spot free-on-board prices in Singapore, which serves as Asia's benchmark. As of November 7, jet fuel stocks on the U.S. West Coast were at a three-month low, totaling 11.12 million barrels.
