Logistics giant DHL considers its jet fuel supply for the summer months to be secure despite uncertainties stemming from the conflict involving Iran. This is due to an easing of market conditions and diversified sourcing, Mike Parra, CEO of DHL Express Europe, told Reuters on Tuesday. 'At the moment, we see no risk,' he emphasized. The market for aviation fuel has stabilized in recent weeks as demand has softened and imports to Europe from the U.S., Nigeria, and South Korea have increased. 'All in all, there have been no supply bottlenecks so far,' the executive said.

The conflict between Iran and the U.S. has periodically brought oil flows through the Strait of Hormuz in the Persian Gulf to a near standstill. Typically, about one-fifth of the world's oil and a quarter of Europe's jet fuel pass through this route. Concerns about a shortage of the critical raw material had followed.

Parra added that the company's global network and contingency plans would allow it to cushion potential local shortages. Aircraft could be refueled at alternative locations and flight routes adjusted if necessary. Furthermore, DHL Express can shift freight to road transport or reroute it through other hubs. Overall, the division maintains a broad base of long-standing suppliers for jet fuel. Additionally, Sustainable Aviation Fuel (SAF) now accounts for ten percent of the fuel mix. 'That is a significant amount,' he stressed: 'Thus, this broader fuel mix strengthens our flexibility and resilience.'

SURCHARGES DO NOT ALTER CUSTOMER BEHAVIOR

Customer behavior has not changed despite significantly higher jet fuel surcharges. Most recently, DHL's surcharge stood at 48.75 percent for international express shipments. Competitors FedEx and UPS also pass on additional costs resulting from higher fuel prices. The surcharges serve exclusively to cover costs and are 'not an additional source of revenue,' the manager underlined.

Second-quarter results for Express Europe are expected to be roughly in line with the first: 'I would say they are at the level we saw in the first quarter.' This refers to revenue, he added.

DHL's largest division, which transports urgent documents and goods, employs around 120,000 people worldwide and operates a fleet of approximately 295 aircraft. In Europe, it has around 40,000 employees and over 100 aircraft. In the first quarter, the Express division recorded a slight global revenue decline to six billion euros, while its operating profit (Ebit) rose significantly by 20.6 percent to 799 million euros. In Europe, DHL Express saw a 3.4 percent increase in revenue during the first quarter.

(Report by Matthias Inverardi, edited by Scot W. Stevenson. For inquiries, please contact our editorial office at berlin.newsroom@thomsonreuters.com (for politics and economics) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)

- by Matthias Inverardi