NEW DELHI : Airfares will increase as airlines, emerging from the effect of the covid-19 pandemic, are not in a position to absorb the rising fuel bill, the director-general of the airline industry body, The International Air Transport Association (IATA) Willie Walsh, said on Wednesday.
Aviation turbine fuel (ATF) accounted for most of the cost of operating airlines, carriers are in a better position now to respond to the challenges after weathering high oil price regimes in the past, Walsh said.
“The forward curve shows that oil prices will come down. Some of the issues (leading to higher oil prices) we are facing are temporary," Walsh said.
Crude oil prices have risen sharply in the past few months, mainly because of the Russia Ukraine conflict. Brent crude was trading at $109.10 a barrel, on Wednesday evening, up 79% on an annual basis.
According to data compiled by IATA, global air passenger traffic in February 2022 (measured in revenue passenger kilometre) was up 115.9% compared with February 2021. Compared with February 2019, however, traffic was down 45.5%.
Meanwhile, airlines in the Asia-Pacific region, which includes India, reported a 144.4% rise in February 2022 passenger traffic against the year-ago period, and up 125.8% over the previous month. Walsh said that India, which has a huge domestic market and an international market that is strategic to several foreign airlines, will gain from the easing of restrictions.
