The aviation industry has been blindsided by a surge in jet fuel prices due to the US-Israeli war against Iran, with fuel accounting for one-quarter of operating expenses. Airlines are forced to raise fares and revisit financial outlooks to offset rising fuel costs.
An aircraft of German air carrier Lufthansa takes off from Berlin Brandenburg Airport in Schoenefeld, Germany on April 21. A surge in jet fuel prices from US$85-US$90 (S$109- S$115) to US$150-US$200 per barrel amid the US-Israeli war against Iran has blindsided the aviation industry, where fuel accounts for up to a quarter of operating expenses, forcing airlines to raise fares and revise financial outlooks.
Chinese airlines will raise fuel surcharges for domestic flights from May 16, with surcharges for domestic flights of 800km or less to rise by 30 to 90 yuan (S$6 to S$17). The airline group expects a US$2.4 billion increase in its fuel bill this year. The Greek airline expects suspended Middle East flights and a spike in fuel prices to have a "notable impact" on its first-quarter results.
Air Canada has suspended its full-year guidance due to fuel price volatility, while India's Akasa Air introduced a fuel surcharge ranging between 199 and 1,300 Indian rupees (S$3 to $17). Various other airlines including Delta, Japanese carrier, South Korean carrier, Philippines-based airline, Hawaiian carrier, Hong Kong carrier, and US budget airlines have taken measures to offset the increasing fuel prices. Airlines cancel flights, reduce capacity, hike fares, and increase surcharges to cope with the rising fuel costs.
The overall aviation industry is significantly impacted by high jet fuel prices
Aircraft Lufthansa Jet Fuel Prices War Against Iran Aviation Industry Surges In Jet Fuel Prices Fuel Costs Airline Bookings Fuel Surcharges Higher Fuel Prices Q4 2021
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