Aviation fuel demand modelling in OECD and developing countries: impacts of fuel efficiency Mohammad Mazraati* and Osama M. Alyousif** *Energy Studies Department, The Organization of the Petroleum Exporting Countries (OPEC), Obere Donaustrasse 93, 1020 Vienna, Austria. E-mail: mmazraati@opec.org and mo_mazraati@yahoo.com **Mechanical Engineering Department, College of Engineering & Petroleum, Kuwait University, PO Box 5969 Safat, Kuwait. E-mail: alyousif@kuc01.kuniv.edu.kw Abstract On the quest for reducing the fuel consumption per passenger per flight for economical and environ- mental reasons, commercial aircraft manufacturers are implementing new strategies for optimising aircraft performance by using new lighter and stronger materials and enhancing engines’ effici- encies in terms of fuel consumption and maintenance requirements. With the rising and falling of economies, whether in the Organization for Economic Cooperation and Development (OECD) countries or other developing countries, the aviation industry has been affected by multiple factors such as passenger traffic, freight traffic, airport capacities and oil prices. Aircraft manufacturers have worked on improving the engine efficiency of their newly built airplanes (e.g. Airbus’s A-380 and Boeing’s B-787), and many airports in the world have increased the number of their runways to face the increasing demand for air traffic in the world.Aviation efficiency can also be achieved through better load management, which in return enables airliners to cope with higher oil prices or rising costs. Aviation fuel demand is modelled in OECD North America, Europe and Pacific regions and some selected developing countries. Price elasticities of fuel demand in all regions are low, while income elasticities are high. The elasticity of aviation fuel demand on passenger kilometre per- formed (PKP) is considerably low. One per cent increase in PKP leads to less than half a per cent increase in aviation fuel demand, confirming an ongoing fuel efficiency in aviation industry. 1. Introduction Passenger traffic is expected to grow at a rate of 5 per cent for the next 20 years, and current numbers of passengers should double by the year 2020 (FAA, 2008). Aircraft manufac- turers aim to meet the demand for more airplanes to carry the expected increasing numbers of passengers, but such goals are challenged with economical and environmental chal- lenges (Airbus, 2007; Boeing, 2007). Increased crude oil prices have affected the aviation industry with increased jet fuel prices, and consequently, have brought additional costs to air carriers. Environmental regulations for carbon gases emissions have also induced 23 © 2009 The Authors. Journal compilation © 2009 Organization of the Petroleum Exporting Countries. Published by Blackwell Publishing Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA.