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Willie Walsh, the Director General of the International Air Transport Association (IATA), said the two-week U.S.-Iran ceasefire is positive for the airline industry but warned of higher jet fuel prices for some time, even if the Strait of Hormuz is reopened.
Jet Fuel Prices Remain A Major Concern
Fuel is the second largest expense for the airlines, accounting for roughly 27% of operating costs. Fuel prices depend heavily on refining capacity, much of which has been disrupted in the Middle East conflict. In fact, jet fuel prices surged more than oil prices, even doubling at one point during the crisis.
Since the war erupted, WTI crude oil futures surged to nearly $118 per barrel from $67 per barrel and have now fallen below …
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