Jet Fuel Prices Soar, This Airline Cuts 20,000 Schedules and Closes Subsidiary
Jakarta, CNBC Indonesia - German airline Lufthansa is cutting around 20,000 short-haul flights until October 2026. This step is being taken amid a surge in jet fuel prices due to the Iran war, which has raised fears of global energy supply disruptions.
The Lufthansa Group states that the route reductions, particularly from its main hubs in Frankfurt and Munich, aim to cut costs while saving around 40,000 metric tonnes of jet fuel.
In addition, the company closed its regional subsidiary CityLine last week as part of efficiency measures. The consolidation of the European network also involves several airlines under the group, such as Lufthansa Airlines, Austrian Airlines, Brussels Airlines, SWISS, and ITA Airways, including operations at hubs in Brussels, Rome, Vienna, and Zurich.
The surge in fuel prices is the main pressure on the aviation industry. Since late February, global jet fuel prices have jumped from around US$99 per barrel (Rp1.68 million) to US$209 per barrel (Rp3.55 million). This sharp rise is triggered by conflict around the Strait of Hormuz, a strategic route through which about one-fifth of the world’s oil supply passes.
This situation is beginning to affect passengers, with fewer flight options and higher fares, especially ahead of the summer holiday season. Several airlines are also raising additional fees such as baggage and fuel surcharges.
The head of the International Energy Agency (IEA) has warned that current jet fuel stocks in Europe are only sufficient for about six weeks. If supplies do not improve, airlines are expected to continue cutting routes.
European Union Energy Commissioner Dan Jørgensen emphasised that the impact of this conflict is not temporary. “This is not a short-term and minor price increase,” he said, as quoted by The Associated Press on Thursday (23/4/2026).
He also revealed that the war is burdening Europe with around 500 million euros per day, equivalent to US$600 million or approximately Rp10.2 trillion. “Even in the best-case scenario, the situation is still bad,” he added.
Jørgensen stated that the European Union government is “very concerned” about the potential jet fuel shortage. Although various measures have been taken, Europe is still considered to be in a defensive position facing this energy crisis.
On the other hand, Lufthansa assures that its fuel supply is still secure for the next few weeks. The company is also taking various steps to maintain supply stability during the summer, including direct fuel procurement.
Based on Cirium data, nearly all of the world’s 20 largest airlines are also cutting flight schedules in May. Airlines such as Delta Air Lines, United Airlines, American Airlines, Air Canada, Emirates, Qatar Airways, Air China, British Airways, and Air France-KLM are making similar adjustments.
Other airlines are also taking efficiency measures. Edelweiss Air has stopped routes to Denver and Seattle, and reduced flights to Las Vegas. Air New Zealand has even cut around 4% of its flight schedules in May and June.
In the United States, Delta Air Lines has cancelled plans to add capacity in June, resulting in available seats about 3.5% lower than the initial target.
Meanwhile, fuel cost pressures are also hitting airlines’ financial projections. United Airlines has cut its annual profit estimate to US$7-US$11 per share, down from the previous projection of US$12-US$14 per share.
This situation underscores that the global aviation industry is facing heavy pressure, with energy price uncertainties expected to persist in the long term.