The Long Road: Quantifying Europe's Exposure to Transport Disruption

Europe's primary risk from jet fuel shortages is concentrated in the tourism sector, particularly impacting Southern Europe, while goods production remains more dependent on land transport.

Key Takeaways

• 1.Jet fuel shortages pose a limited risk to industrial production but a major threat to the tourism sector, particularly in Southern Europe.
• 2.A new 'physical distance travelled' metric reveals that Southern European economies and capital goods sectors have the longest and most vulnerable supply chains (~5,000 km).
• 3.ECB tightening is likely to be capped at 2.50% as growth risks from fuel shortages and financial tightening weigh on the outlook.

Table of Contents

• Authors
• How much transport in value chains?
• Implications for fuel usage
• Tourism: a distinct, service-based vulnerability
• Beyond jet fuel: Measuring exposures to transport friction
• What this means for the ECB: Measured tightening...at most
• Appendix 1

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