Rising jet fuel costs and conflict in Strait of Hormuz threaten European air travel

The International Air Transport Association (IATA) warns that rising jet fuel prices, driven by the conflict in the Middle East and tensions in the Strait of Hormuz, make airfare increases in Europe inevitable. Despite temporary promotional efforts to sustain demand, airlines can no longer absorb the escalating operational costs, which have seen jet fuel prices in Europe exceed 200 dollars per barrel. Middle Eastern refineries, accounting for over 10 percent of global jet fuel production, face significant shipping disruptions, hindering supply chains to external markets. Consequently, many airlines have begun canceling flights, grounding older, less fuel-efficient aircraft, and raising ticket prices. Europe, particularly Britain, is actively seeking alternative fuel sources to mitigate these disruptions. Data from OilX indicates that Asian refineries have also seen production capacity drop to 2.9 million barrels per day. The market remains fearful that further route cuts and price hikes will follow as the conflict persists.