SAS Warns of E-SAF Supply Crunch as ReFuelEU Mandate Tightens

Scandinavian Airlines has warned that Europe is on course for a structural shortage of electro-sustainable aviation fuel, raising the prospect of higher fares, route cuts and a fresh energy vulnerability for the bloc just as its flagship ReFuelEU Aviation regulation enters into force.

In a report published this week, the carrier said no European e-SAF production facility has yet reached Final Investment Decision, even as legally binding submandates begin to bite from 2030. Scandinavia alone will require 36,000 tonnes of e-SAF in 2030, rising to more than 160,000 tonnes by 2035 and 330,000 tonnes by 2040, equivalent to the output of around five dedicated plants. Today, none exist on the continent.

The warning lands in the middle of a wider fuel squeeze. Around three-quarters of Europe's jet fuel supply is imported, and Lufthansa has already trimmed capacity, with chief financial officer Till Streichert citing sharply higher fuel costs and geopolitical instability. SAS, which became the first European carrier to cut services in response to the Middle East jet crisis, is now flagging a second shock embedded inside the EU's own climate framework.

In a structurally short market, e-SAF prices are expected to move towards the cost of non-compliance under EU rules, a benchmark several times higher than fossil-based jet fuel. Mads Brandstrup Nielsen, SAS senior vice president for public affairs and sustainability, said the bloc was at risk of creating a regulated system "where demand is mandated but supply is not".

For Brussels, the report sharpens an uncomfortable question already weighing on the Draghi competitiveness agenda: whether Europe will manufacture the molecules its decarbonisation rules require, or import its way into the next dependency.