European Airlines Face Worst Crisis Since Pandemic
Frankfurt (ANTARA) - The European aviation sector is facing the worst crisis since the 2020 pandemic, as the ongoing conflict in the Middle East drives jet fuel prices to their highest levels in several years and forces major airlines to overhaul their strategies.
In its first-quarter (Q1) earnings report published on Wednesday (6/5), Germany’s national carrier Lufthansa stated that it has hedged around 80 percent of its jet fuel needs.
Despite this measure, it forecasts fuel-related costs in 2026 to rise by 1.7 billion euros (1 Euro = Rp20,422), nearly 24 percent higher than previous estimates, primarily driven by surging energy prices and disruptions in the global aviation market.
The group said it plans to offset the additional burden through higher ticket revenues, network optimisation, and further cost-cutting measures in the coming quarters.
“The ongoing crisis in the Middle East, combined with rising fuel costs and operational constraints, poses major challenges to the global economy, the aviation industry, and our company,” said Lufthansa CEO Carsten Spohr.
According to the International Air Transport Association (IATA), jet fuel prices surged 106.6 percent year-on-year in March amid escalating geopolitical tensions. In Europe, prices have risen to their highest levels since 2022.
Analysts at Allianz Trade described an equally bleak situation, estimating that international airfares have increased between 5 and 15 percent.
IATA Director General Willie Walsh stated that while the industry is still in better shape than during the 2020 pandemic lockdowns, the current fuel crisis emerges as the most serious shock to global aviation since COVID-19.
According to a study released by Allianz Trade last week, Europe produces only half of the kerosene needed by its domestic market, leaving the aviation sector in the region reliant on imports to meet the remainder of its jet fuel requirements.
Several European airlines have introduced measures to counter rising fuel costs and concerns over potential supply disruptions.
Air France-KLM said it plans to impose surcharges of up to 50 euros on long-haul flights, while EasyJet and Ryanair warned that fares could rise further if the fuel market remains tight. Lufthansa stated that it has implemented ticket price increases.
Lufthansa is also evaluating transit options for its long-haul routes to Asia and Africa as a precautionary measure against potential refuelling failures at destination airports.
Highlighting the severity of the supply crisis, Spohr said, “We can only fly if we have fuel.”