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July 18, 2024
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The US and Indonesia have agreed to jointly study aviation fuel made with palm oil.  Starting in 2018, all airlines operating in Indonesia will be required to use biofuel for their aircraft to help reduce air pollution.

The Indonesian government has examined production of aviation biofuel from either palm oil or water hyacinths as raw materials, both of which are abundant in Indonesia.  As the largest producer of palm oil in the world, and the second largest producer of certified sustainable palm oil, Indonesia will be able to produce bio fuel for aviation with verified and environmentally sound international practices.

We have seen different biofuel feedstocks around the world, from corn, common in the US, to cane, readily available in Brazil, and now palm oil, readily available in Indonesia.  While each have slightly different characteristics, each will operate in a more environmentally sustainable fashion than traditional Jet A.  As these new sources replace oil, the demand for oil will continue to decline, and future oil prices should remain low while the environment benefits, a win-win for both consumers and airlines, and perhaps bad news only for OPEC.

by Fabio Gigante

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