EasyJet is expected to suffer a financial loss of up to $756 million due to the ongoing conflict in the Middle East. The fuel crisis has led to several airlines suffering from financial issues.
Global Fuel Crisis
The ongoing conflict in the Middle East has led to a global disruption of oil supplies, directly affecting the aviation industry. For instance, SAS saw the need to cancel 5,000 flights in April, given the high prices of fuel.
Around 20% of all oil supplies pass through the Strait of Hormuz, which is currently under both Iranian and American blockade. This led the world of aviation to an enormous crisis, which has now been going on for two months.
Another issue that runs alongside fuel shortage, is the spike in price. Fuel prices skyrocketed due to the limited amount that the market currently has. Overall, both fuel shortages and high prices are contributing components to EasyJet’s shortfall.
EasyJet’s Financial Loss
EasyJet’s financial loss is a major problem for the carrier. In March, the airline sustained a damage of £25 million solely from the rise in oil prices. The number is exponentially rising as the crisis keeps going on, leading the airline expect a loss of almost $759 million.
The blockade in the Strait of Hormuz is the primordial reason for the disruption in the global oil market. The carrier itself expressed the uncertainties in the industry given the conflict. EasyJet explained that passenger bookings have decreased due to the shortage, as tickets have gone up significantly.
Within Europe, airlines and airports are reaching out to authorities in the Gulf to act to protect their interests. These actions include improved monitoring the available amounts of fuel.
What’s your view on the current conflict’s impact on aviation? Are you interested in the issue? Let us know your thoughts in the comments.
