Insight Focus
Oil shock accelerates shift toward sustainable fuels. Disruptions to crude flows and rising fuel costs are straining global transportation markets while reinforcing energy security concerns. At the same time, SAF adoption is gaining momentum globally, supported by new policy coordination, though current production remains far below aviation demand.
Oil Disruption Fuels Renewed Interest in Sustainable Fuels
The shock to oil markets resulting from the US war with Iran is having powerfully negative effects on industries and citizens around the world who rely on efficient transportation.
With an estimated 20% of the globe’s supply of crude oil currently unable to move through the Strait of Hormuz, the costs of processed petroleum products like gasoline and diesel fuel are rising daily to heights not seen in decades. If the conflict in the Middle East ends soon, the effects of the disruption in the petroleum markets are likely to be felt for many months.
Source: EIA
One effect of the disruption, seen as a positive for some, however, is a surge in interest in producing and adopting sustainable fuels for use in aviation and maritime transportation. Sustainable Aviation Fuel (SAF) and Sustainable Marine Fuel (SMF) offer hope for helping mitigate the rising prices of petroleum-based fuels while simultaneously promoting the decarbonisation of aviation and marine shipping.
In the US, approximately 300 million gallons of SAF was produced in 2025, up about two-and-a-half times from 2024, according to government and industry reports. The amount is small when considering that US airlines use approximately 20 billion gallons of fuel per year.
Momentum Builds Behind Global SAF Alignment
According to news sources, the Global Biofuels Alliance (GBA) is negotiating with governments across the world to establish a SAF corridor linking global airports—a framework designed to drive SAF policy harmonisation and standardisation across jurisdictions and position India as a global aviation bunkering centre.
GBA Director Joshua Wycliffe said at an industry event in New Delhi, “GBA is in very active talks with the governments of the Netherlands and Singapore to work on a SAF corridor between airports—between, let’s say, Amsterdam-Delhi, Amsterdam-Mumbai, Singapore-Mumbai, Singapore-Delhi.”
Wycliffe said at the Indian Federation of Green Energy’s recent Green Transport Conclave in New Delhi, “What it does is not just promote SAF, it promotes standardisation, brings governments together, brings policy mandates together and also helps defragment policy differences.”
In South America, Brazil said its corn ethanol passed a significant regulatory step with the International Maritime Organization, giving the country an edge against the US and other competitors in the race to provide biofuels for ocean vessel transportation. Brazil’s second-crop corn ethanol is the first biofuel compatible with marine transport to have its carbon footprint defined and approved by the IMO, according to Flavio Mathuiy, a navy captain who represents Brazil at the world’s shipping regulator.
The move clears a key hurdle for Brazilian ethanol ahead of enforcement of a global IMO framework to cut greenhouse gas emissions in maritime transportation, providing a potential boost to the country’s corn farmers and ethanol traders.
Japan’s Transport Ministry is also working on plans to charge air travel passengers for SAF use starting around 2030. The Japanese government has a 2030 goal for domestic airlines to use 10% SAF.
