it won't persist at these high prices, way too many levers and knobs to increase supply and drive price down

Not in isolation and not for long.... but if this thing gets funkier and we are facing a united Russia & China against the world.... game changer.

Russia susceptible to economic pressures... China less so since American CEOs sold their souls, and their technology, (the rest the Chinese stole), to access the Chinese market for cheap labor. Many of our domestic industries, as currently configured, would be screwed without access to Chinese factories.

Lenin may have said that the Communists would sell us the rope with which they would hang us. The Chinese have, with Western complicity, made good on the promise.

Today’s NYM front month crude price settled at $120.62/bbl; futures for December 2022 settled at $97.85 (low of $96). So the oil markets are forecasting lower prices by the end of 2022. I don’t see this as having a huge impact on GA for 2022 at least. If this goes on a long time, then perhaps we might see more of an impact.

For turbine aircraft, fuel cost are really not the big driver of annual operating costs that many people think. I’m planning several long trips and while I look for the cheapest Jet A where I can find it, I am still going and buying fuel. Of course that’s just me and YMMV. But I don’t think in turboprop-land or turbofan-land, the difference between $4 and $10 fuel matters a whole lot to those owner-operators. It matters, and its a real cost, but I don’t see it driving purchase and sale behavior in those market segments.

Pistons may be a different matter for some people, but the volumes consumed are also a lot less. I have a friend with a Rotax-powered Tecnam LSA that cruises around at about 4 gph. It’s not going to change his behavior much for example.

10 dollars a gallon piston fuel will seriously affect the market and piston values.

7 dollars a gallon Jet A will have a negative impact on Turbine values and activity.

Absolutely spot on.

$7 jet fuel will absolutely will slow things down a bit and airplanes will get parked, sold, or both.

In a strange turn it’s the middle distillate streams ( Jet A) that are currently leading the way in the tightening of refined products.

Where Jet A use to enjoy a substantial price advantage over 100LL I believe we are more likely to see $6-7 Jet A, while 100LL sells for maybe a dollar more and perhaps on parity in the near term.

Avgas already almost a buck higher than couple months back at my field

As often happens here on Beechtalk we're talking about the aircraft market like it is a single market instead of a dozen or more markets with sub-markets making up those respective markets.

The fact is that Joel is right, for most turbine operators, the increase in fuel cost is going to be an aggravation, but they aren't going to stop flying and sell the airplane anymore than anyone else is going to stop driving and sell their car.

Let's take Mark's 180 gal per hour legacy Citation and use a $3 a gallon increase in Jet A.

180 gallons X a (long) 4 hour leg X $3 = $2160

That's a little over $4k a trip... it isn't fun but it isn't the end of the world.

Even if you look at it on an annual basis, flying 150 hours cost an additional $81k

There are some folks that may decide that's $80k too far, but most won't, especially if they feel like it is temporary.

It is also important to separate the aviation market from the inventory level, though there is some cause and effect, they are two different things.

We are currently seeing the exuberance in this market fade, things are definitely slowing, being on the acquisition side we see it before everyone else because we are early in the process. Please don't misunderstand what I am saying, we are seeing fewer calls from prospective aircraft purchasers, but we are also fully booked, have been for the last two years and we're still turning away business. Things are slowing down, but we are still at capacity and from the market's standpoint things are slowing down... but inventory levels are still dropping.

I suspect we'll see some of the stupidity subside, less demand will mean less urgency and more normalcy in the buying process, but it isn't going to be near enough to fix the inventory problem. There's more buyers than airplanes, that hasn't changed. I'm hoping prices level off and sanity returns, but prices are not likely to decrease and inventory levels won't increase substantially unless we have a catastrophic economic event.

So $160k pretax. Ya. Fair enough. That's nothing

Interesting that the same people won't spend $800-$1000 a day to hire an SIC! Go figure.

So $160k pretax. Ya. Fair enough. That's nothing

Interesting that the same people won't spend $800-$1000 a day to hire an SIC! Go figure.

So $160k pretax. Ya. Fair enough. That's nothing

Interesting that the same people won't spend $800-$1000 a day to hire an SIC! Go figure.

JC reports Jet A at KASE is $10

Yeah but no one pays retail for Jet A. I see one fuel card price listed as only $8.68.

Sometimes you pay retail for JetA, but mostly you don't. Looking over the CAA national price list, JetA prices run from approx $3.90 to maybe $5.50, plus or minus. Up between $1-$2/gallon. That's just not going to move the needle much for most people. What operators will look at is their blended fuel cost, not the price at any one location.

And some airports have always high retail JetA prices (and fewer discount program options), like the mountain destination airports, or large Bravo airports - and if you are going there you know ahead of time that you are going to pay for it. I'm looking at a trip to Boston and KBOS retail prices are about $10, as I recall. But at KBED, CAA pricing is $4.50 (approximately). In 2019, retail JetA was over $8/gallon at KSDL but we wound up paying $3-something for it via CAA. These programs make a big difference.

When you operate a turbine, your fuel cost is actually a surprisingly small part of your total cost of ownership. I'm not saying it won't have an impact, but most operators will pay and move on.

Now where it might affect the market is that some people who are new to turbines (particularly jets) might have said "oh wow, I can buy a jet for only [$1-$2] million?? [fill in your own number] That's cheap!!!" - and then they bought it thinking that acquisition cost was the big hit. Only to find that many of these jets can easily cost upwards of $2-3000/hour to operate on an all-in, total cost of ownership basis. More if you assume some depreciation will hit them eventually. For those owners, a doubling of JetA prices could cause them to change behavior ... Chip and others will have a better sense of how prevalent that type of owner has been in this market. Even wealthy people can get sticker shock when they realize the TCO on some turbines. But experienced operators will most likely shrug off the fuel cost increases, at least the ones we've seen so far.

Just my two cents!