Bad news for international air travelers
New York: Due to the increase in crude oil prices at the global level, airlines have also raised their fares, resulting in a noticeable decrease in passenger traffic.
According to details, in recent days, there was a significant increase in the sale of tickets by American airlines in response to the decrease in oil prices. However, in the past few weeks, with the rise in oil prices, there has been a 20% decrease in ticket sales in the last three months.
In this situation, Australian company Qantas has stated that it can increase ticket prices in response to the reaction to the rising fuel prices. Speaking to the Financial Times, the national carrier of Finland, Finnair, and Barclays Bank officials expressed the expectation that similar principles will be applied to other international companies.
This step has been taken after the price of oil reached its highest level of $95 per barrel following the record of $135 per barrel for jet fuel on September 15, according to IATA when the price of one barrel of oil reached $94 per barrel. According to analysts, this is a monthly increase of 9% but still, on an annual basis, oil prices are nearly 2.5% lower.
European airlines have benefited greatly from their global rivals because they had taken protective measures against the sharp rise in fuel prices.
These airlines have minimized losses by renegotiating previous purchase contracts. In contrast, American airlines are in a difficult situation as they usually do not hedge. These concerns have led to a significant increase in airline stocks in recent weeks due to the relevance of the increase in crude oil prices.