IATA warns that airlines face high costs and limited supply of sustainable aviation fuel, slowing the aviation industry’s green transition

The International Air Transport Association has warned that the global airline industry is struggling to adopt sustainable aviation fuel due to high costs and limited production, slowing the sector’s transition to greener operations.

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Willie Walsh, IATA Director-General, made the remarks during the Changi Aviation Summit on Monday, ahead of the Singapore Airshow.

He stated that sustainable aviation fuel, or SAF, is crucial for reducing carbon emissions but remains a small fraction of total jet fuel consumption.

“SAF output reached 1.9 million tonnes in 2025, representing just 0.6 percent of total jet fuel use,” Walsh said, noting that this was a downward revision from earlier forecasts.

He explained that mandatory regulations requiring airlines to include SAF in their fuel mix have driven prices up, discouraging voluntary uptake.

European Union rules, for example, mandate a two percent SAF blend this year, rising to 20 percent by 2035, with a long-term target of 70 percent by 2050.

Walsh said SAF currently costs more than double fossil-based jet fuel, and in regulated markets, the price gap can widen to four times.

Singapore is attempting to boost adoption through a voluntary SAF trial, involving companies such as Google, Temasek, and Singapore Airlines.

From October 1, flights departing from the city-state will be required to use one percent SAF, with a levy imposed to fund the initiative.

Targets aim to increase the SAF blend to three to five percent by 2030, in line with International Civil Aviation Organization goals.

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The warning underscores the tension between ambitious environmental targets and practical implementation, as airlines and regulators work to accelerate the transition to low-carbon operations.