Global Airlines Cut Routes, Hike Fares Due To Fuel Spikes


Approaching the six-week mark since the conflict in the Middle East began, the global aviation industry has been significantly impacted in the previous weeks by a number of factors. From reduced connectivity and capacity to increasing fuel prices and operational difficulties associated with airspace accessibility, the issues stemming from the conflict are not localized to the region and are affecting airlines all around the world.

Ultimately, the increasing operational costs are being passed onto the passengers, which means passengers flying now will be paying significantly more than what they would have paid if they were flying six weeks ago, regardless of the airline or their itinerary.

Increasing Jet Fuel Prices Affect Ticket Fares

Delta B767-400ER about to land Credit: Shutterstock

For context, the rising jet fuel prices significantly affect an airline’s operational costs, because fuel accounts for 30 to 40% of the overall cost an airline faces. Therefore, with data published by the BBC indicating that jet fuel is now priced at $1,838 per ton, compared to just $831 per ton prior to the conflict, the 221% increase in fuel costs severely impacts airlines’ already slim profit margin.

This naturally results in airlines gradually passing on the increasing costs and fuel surcharges onto the passengers, subsequently increasing ticket fares. However, because of the competitive nature of the aviation industry, paired with the fact that different airlines and airports have a varying degree of access to fuel (based on geographical locations), some carriers are forced to strategically cut services rather than try to compete with other operators.

For major carriers in the US, such as United Airlines, Delta Air Lines, and American Airlines, data indicates that the rising fuel prices will see the carriers spend an additional $11 billion this year on fuel costs, due to the expansive fleet and network these airlines operate. The BBC published the following statement from Delta’s CEO, Ed Bastian:

“There’s a high sense of urgency to address higher fuel costs and reduce unprofitable flying.”

Some Airlines Are Strategically Increasing Services

Singapore Airlines A380 taxiing Credit: Shutterstock

That being said, it is worth noting that, while some airlines are forced to cut services and even ground parts of their fleet, such as Qatar Airways sending around a dozen aircraft to long-term storage in Teruel Airport (TEV) in Spain, there are other airlines cashing in on the opportunity and launching more services to markets with high demand.

Singapore Airlines, for one, has announced it will be launching an additional service to London this summer, which will see the carrier operate two daily services between Singapore Changi Airport (SIN) and London Gatwick Airport (LGW). This will, of course, be complemented by the airline’s existing four daily services to London Heathrow Airport (LHR) as well, of which two services are operated by the carrier’s Airbus A380 aircraft type.

Furthermore, the carrier constantly competes with the Middle Eastern super connectors when it comes to connecting Europe with Australia. Considering the carriers in the Middle East have had their operations significantly disrupted and their networks not yet back to normal, Singapore Airlines is also expanding its operations in Australia. The airline will be launching services to Western Sydney International Airport (WSI) this Spring (in Australia), while also returning its A380 services to Melbourne, resulting in the airline operating a record 23 daily flights to Australia.

Singapore Airlines A350 taxiing on the ground

Six Flights A Day: Singapore Airlines Boosts London Capacity To Record Levels

With a second daily service to Gatwick, SIA will operate up to 6 daily flights this summer.

Airspace Is Also A Major Issue

Boeing 737 silhoutte flying with sun setting behind it Credit: Shutterstock

Another global issue stemming from this conflict is the accessibility to airspace, particularly when considering flights between Europe and Asia. While the Middle East was a popular corridor for flights, especially for airlines operating services avoiding the Russian airspace, the ongoing conflict has essentially made a large portion of airspaces over the Middle East inaccessible to most carriers.

This means that any carrier now operating flights between Europe and Asia, or flights to the Middle East, is forced to operate using longer flight paths to ensure flight safety and avoid areas of risk, which results in increasing flight times and fuel burn. This further exacerbates the impacts of rising fuel costs on the airline’s operational costs, which are being passed onto the customers in the form of increasing fuel prices.

Ultimately, the rising fuel costs, access to fuel at airports, and operational factors have resulted in thousands of flights being canceled by carriers in the Middle East, but also by airlines in other parts of the world, such as North America, Europe, and Australasia. The canceled flights have also resulted in demand exceeding capacity available, which further drives up the prices for passengers.





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