Fuel shortages spark flight cancellations and fare increases as Europe prepares for disruption.
Dubai: Airlines across Europe and other international markets are canceling flights, raising fares, and cutting routes as a deepening jet fuel crisis begins to disrupt global aviation.
The shortage is being driven by a sharp decline in oil supply linked to the ongoing US-Israel conflict with Iran, which has significantly affected shipments through the Strait of Hormuz, a key corridor for global energy transport.
According to Bridget Payne, Head of Energy Forecasting at Oxford Economics, approximately 10 million barrels per day of oil supply have been removed from global markets, creating a shortfall that is increasingly difficult to offset. Jet fuel, in particular, has emerged as one of the hardest-hit segments of the energy market.
Bridget Payne noted that aviation demand is more sensitive to price increases than other sectors, as air travel is largely discretionary and fuel costs are quickly passed on to passengers through ticket prices.
“Air travel is more discretionary than road freight or household energy use, and fuel surcharges are rapidly reflected in ticket prices. This makes aviation one of the first sectors where demand is curtailed by higher costs, particularly for leisure travel,” she wrote in a research briefing, warning that a prolonged conflict involving Iran could trigger severe fuel shortages.
With Brent crude prices rising sharply since the onset of the crisis, some demand destruction has begun—but not enough to fully bridge the supply gap. This imbalance is pushing the market toward rationing, which could severely disrupt airline operations.
Fare hikes and cancellations
Several major carriers have already started adjusting operations, Reuters reported.
Air France-KLM, Cathay Pacific, Thai Airways, SAS, and United Airlines have increased fares, added fuel surcharges, or cut routes. Notably, Cathay Pacific raised fuel surcharges by 34% starting April 1.
Thai Airways has announced fare increases of 10–15%, while SAS (Scandinavian Airlines) plans to cancel around 1,000 flights in April.
AirAsia X reported raising fuel surcharges by approximately 20%, with overall fares increasing between 31% and 40%. The airline also expects to reduce flights on routes where fuel costs can no longer be covered.
European airports impose fuel restrictions
The crisis is already creating operational constraints at airports across Europe.
Four northern Italian airports — Milan Linate, Bologna, Venice, and Treviso — have implemented jet fuel restrictions due to dwindling supplies.
Priority is being given to medical and emergency flights, state operations, and long-haul flights exceeding three hours.
Short-haul flights are now limited to 2,000 litres of fuel per aircraft, providing less than one hour of flight time for planes such as Boeing 737s or Airbus A320s. This effectively restricts certain domestic routes unless aircraft refuel at alternative locations.
Summer travel at risk if crisis persists
Airlines are increasingly warning that the jet fuel crisis could worsen if disruptions continue.
Ryanair has indicated it may reduce routes and cautioned that summer flights could be at risk. Lufthansa is preparing contingency plans and could ground up to 40 aircraft. United Airlines plans to cut unprofitable routes over the next two quarters, while Air New Zealand will reduce flights by about 5% from May. Vietnam Airlines and other regional carriers are also scaling back operations.
Ryanair CEO Michael Kevin O’Leary warned that supply disruptions in Europe could begin as early as May if the conflict continues.
Rising costs ripple across global aviation
The financial impact on airlines is substantial. United Airlines’ CEO warned that current fuel prices could add an extra $11 billion in annual costs — more than double the airline’s record yearly profit.
Meanwhile, Pakistan International Airlines has eliminated passenger discounts and scaled back operations as part of broader cost-control measures.
What happens next?
The International Energy Agency (IEA) has warned that oil supply losses could accelerate in the coming weeks, with jet fuel and diesel shortages expected to spread from Asia to Europe by April or May.
Analysts note that while strategic reserves and inventories are currently cushioning the impact, these buffers are limited.
If the disruption continues, the aviation sector — already highly exposed to fuel price shocks — could face deeper service cuts, higher fares, and widespread cancellations, particularly during the peak summer travel season.
