The high price of oil scares the airlines, the first increases for flights are triggered

The effects of the expensive oil on flight prices: the first to announce a increase in tariffs were the Australian airlines Qantas Airways and New Zealand Air New Zealand but they are not an isolated case: due to the conflict in the Middle East, global airlines are faced with a sudden and dramatic increase in fuel prices which represents a quarter of their total operating costs for them.

Before the conflict they were around 85-90 dollars a barrel

In the last few days they have reached 150-200 dollars. And therefore the higher cost of crude oil could not fail to be reflected in the prices of airline tickets which on some routes have skyrocketed also due to the closure of airspace and the capacity limits of the airlines themselves. For this reason, Qantas is also considering the possibility of reallocating its routes, given that its flights to the Old Continent are now 90% full compared to the 75% usually recorded at this time of year. Likewise, Cathay Pacific Airways will add extra flights to London and Zurich in March.

Apart from these two companies Air New Zealand has increased fares while Hong Kong Airlines said on its website that it will increase fuel surcharges by up to 35.2% starting next Thursday, with the largest increase on flights between Hong Kong and the Maldives, Bangladesh and Nepal. Other companies such as Vietnam Airlines have asked local authorities to abolish the environmental tax on jet fuel.

Because British Airways has no intention of increasing prices

IAG, owner of British Airways, has no intention of increasing ticket prices at the moment, as a spokesperson told Reuters, as it has covered much of its fuel needs in the short and medium term. But the Scandinavian SASfor example, warned that it may have to raise ticket prices. Emirates, Qatar Airways and Etihad typically carry about a third of passengers from Europe to Asia and more than half of all passengers from Europe to Australia, New Zealand and nearby Pacific islands, according to aviation analytics group Cirium.

Approximately 32% of the long-haul network of Lufthansa involves Asia and the Middle East. The exposure of IAG, owner of British Airways, is lower, at 17%, as its Western European hubs favor flights to the Americas. The repercussions of the war are not limited to passenger traffic: according to Iata data, Qatar Airways and Emirates are the second and fourth cargo carriers by volume in the world, ranking between FedEx and UPS and in January volumes between Europe and Asia increased by 15% on an annual basis. If Doha and Dubai remain closed for any period of time, shippers will have to look for alternative hubs and carriers.

In any case, according to analysts, airlines have learned the lessons from past shocks, just think of the pandemic. And the ongoing Iranian crisis will be a test to see how well they have learned their lessons.