Higher European Air Fares Are Coming, IATA Chief Warns
BBC Business reported Wednesday that European air fares will rise as elevated jet fuel costs make lower ticket prices unsustainable for airlines.
Willie Walsh, Director General of the International Air Transport Association, made the warning in an interview with the BBC. He said carriers simply cannot absorb the extra fuel burden indefinitely.
Discounts Will Not Last
Some European airlines have recently cut fares to coax hesitant passengers back onto planes. Walsh acknowledged those discounts exist but called them temporary.
He told the BBC that airlines may continue selectively discounting to stimulate demand. Over time, however, the surging price of oil will feed through into what passengers pay at checkout.
Long-haul routes have already seen meaningful fare increases. Short-haul European pricing has moved in the opposite direction for now, but Walsh said that divergence will close.
How the Strait of Hormuz Disruption Changed Everything
The root cause of the pressure is the closure of the Strait of Hormuz, a chokepoint through which a significant share of global oil and refined fuel moves. The closure followed the conflict involving Iran and has sent jet fuel costs sharply higher.
Europe, and the UK especially, rely heavily on fuel imports from the Gulf region. Suppliers and governments have scrambled to find alternatives. The European Union confirmed last week that US-grade jet fuel could substitute for standard European-spec fuel, provided the transition is handled carefully.
The EU’s energy commissioner said he did not expect an immediate serious shortage. The chief executive of travel operator Sebastien Ebel of Tui echoed that view, saying near-term supply should hold.
UK Summer Season Carries Extra Risk
Walsh reserved his sharpest concern for the United Kingdom. He explained that flight volumes and fuel demand in July and August typically run around 25% higher than in quieter spring months.
If sufficient alternative supply is not secured before peak season, some shortages remain possible in the UK, he said. He was careful to add that widespread cancellations are avoidable and that there is no cause for panic.
A UK government spokesperson pushed back mildly, stating that airlines are not currently reporting jet fuel shortages. The government said it is coordinating with the industry and consulting on measures to help carriers plan realistic schedules that protect passengers’ summer holidays.
Walsh cautioned that even a full reopening of the Strait of Hormuz would not bring prices down quickly. Damage to Gulf refining infrastructure means the supply squeeze could persist well into 2027.
Read Next: What the Iran Conflict Means for Global Energy Markets
