News
Delta · Jet Fuel · Operating Costs · Refinery
Delta Air Lines acquired the Trainer Refinery in Pennsylvania for $180 million in June 2012 through its wholly-owned subsidiary Monroe Energy, aiming to reduce jet fuel costs, but the refinery has since delivered mixed financial results, including significant operating losses in 2013, 2016, and early 2020.
Delta's motivation stemmed from escalating fuel expenses, which reached $12.2 billion in 2012, representing 36% of its total operating costs, up from 30% in 2010. The refinery historically supplied approximately 75% of Delta's jet fuel consumption, or about 200,000 barrels per day, through direct production and product exchanges with third parties.
Financial performance since 2013 shows volatility: the refinery recorded losses of $116 million in 2013 and $125 million in 2016, but also achieved profits of $290 million in 2015 and $110 million in 2017. In 2020, the refinery reported operating losses of $114 million in the first three months and $85 million in the first half, attributed to a significant decrease in jet fuel demand during the "current crisis." Delta responded by increasing production of non-jet fuel products for exchange.
The article, published by Jay Singh on Simple Flying, concludes that the refinery business is inherently volatile, facing difficult years ahead due to low jet fuel demand.
