Tens of thousands of flights across Europe have been cancelled or are at risk of cancellation as the war in Iran sends jet fuel prices to record levels and supplies dwindle, threatening to upend the peak summer travel season.
Jet fuel prices have roughly doubled since the US-Israeli war on Iran began in late February, reaching as high as $209 a barrel by early April. The trigger is the Strait of Hormuz — the vital waterway through which one-fifth of the world’s oil and liquefied natural gas supplies are normally shipped. Iran’s effective closure of the strait in response to US and Israeli strikes has throttled supply to a continent that is acutely exposed.
The scale of the cuts
Lufthansa confirmed it would cancel 20,000 short-haul flights through to October, focusing reductions on routes operated from Frankfurt and Munich while expanding capacity at Zurich, Vienna, and Brussels.
Ten destinations — including Cork, Gdańsk, Ljubljana, Stuttgart, and Trondheim — will be absorbed by other carriers within the group: SWISS, Austrian Airlines, Brussels Airlines, and ITA Airways.
The group said further cuts could be announced by late April or early May and that some reductions may become permanent.
Aer Lingus announced what it described as a 2 per cent reduction in its summer schedule, citing “mandatory maintenance on aircraft”, with up to 23,000 passengers on 430 flights facing disruption.
The airline declined to specify which routes would be affected. KLM cut 80 return flights from Amsterdam; Norse Atlantic cancelled its Los Angeles routes. Scandinavian airline SAS said it was cancelling 1,000 flights in April.
EasyJet spent an additional £25 million in March buying fuel at spot market prices, having previously hedged only 70 per cent of its projected summer needs.
Ryanair chief executive Michael O’Leary warned that if the war in Iran does not end by the end of April, the airline is looking at cancelling between 5 and 10 per cent of flights through May, June, and July, adding that cuts would depend on which airports suffer fuel shortages rather than which routes airlines choose to drop.
Supply running thin
The International Energy Agency warned last week that Europe has “maybe six weeks or so” of jet fuel remaining, with IEA head Fatih Birol calling the situation “the biggest energy security threat in history” and noting that the Middle East normally supplies a large proportion of Europe’s jet fuel imports — a figure that is now “basically almost zero.”
IATA director general Willie Walsh said the association estimates that by the end of May, cancellations in Europe due to a lack of jet fuel could begin, noting that shortages are already being felt in parts of Asia.
Around 75 per cent of Europe’s jet fuel imports come from the Middle East, and secondary supply chains are struggling to compensate. China, the world’s second-largest jet fuel producer, is restricting exports; South Korea has cut output as it struggles to source crude oil to refine; and while tankers are now bringing jet fuel from the United States to Europe, the volumes fall well short of what is needed to offset lost Middle Eastern supply.
EU response
The European Commission announced the creation of a “fuel observatory” to monitor production, imports, exports, and stock levels across the transport sector. EU Transport Commissioner Apostolos Tzitzikostas insisted there was as yet no evidence of “actual shortages” and said widespread cancellations were not expected over the summer, though the statement did little to calm the aviation industry.
EU Energy Commissioner Dan Jørgensen warned separately that the energy crisis sparked by the war is costing Europe around 500 million euros per day and could affect prices for months, “or maybe even years” to come.
What passengers should expect
ING Research senior economist Rico Luman said European travellers should brace for fewer flight options during the peak July and August season, warning: “I’m afraid there’s no quick fix for this, because we’ve seen the damage to the infrastructure in the energy sector in the Middle East. So we expect oil prices to remain high for longer, at least until the end of this year.”
Cirium data shows that more than 60,000 flights to and from the Middle East have been cancelled since the conflict began on 28 February, directly affecting an estimated six million passengers. The knock-on effects for European carriers — through higher costs, longer routing and disruption at Gulf hub airports — are expected to intensify throughout the coming months regardless of whether a ceasefire holds.
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Photo credit: Cassandra Tanti