Tankering Fuel on U.S. Air Force Transport Aircraft: An Assessment of Cost Savings

Aviation fuel use accounts for a large proportion of the U.S. Department of Defense DoD total petroleum use about 50 percent according to a 2012 analysis by the Congressional Research Service. A worldwide increase in fuel prices from fiscal year FY 2005 to FY 2011 led to a 381 percent increase in DoD fuel spending. Understandably, DoD is keenly interested in actions that can reduce its fuel costs. Air Mobility Command AMC, which has large fleets of aircraft providing airlift and refueling services to joint forces, uses about 28 percent of all DoD fuel and is therefore a natural target for reductions. One cost-saving technique that has attracted the attention of policymakers is fuel tankering. Tankering involves carrying excess fuel on an aircraft more than is required for the flight when traveling from origins where jet fuel is less expensive than at the destination and is a common practice in commercial aviation. By shifting fuel purchases from expensive to cheaper locations, tankering can decrease the overall cost of fuel even after accounting for the additional fuel burned flying at heavier-than-required weights. In recent overseas contingency operations in Afghanistan, tankering has been employed by the Tanker Airlift Control Center to generate significant cost savings by exploiting the large differences between fuel prices outside and inside the theater of operations, where they have been up to three times higher.