Brent crude oil, jet fuel and gas prices have all sharply risen after production was impacted by attacks in the Strait of Hormuz
Airports have introduced fuel limits and flights are being cancelled following a surge in jet fuel prices due to the Iran war.
Brent crude oil, jet fuel and gas prices have all surged after production was impacted by attacks in the Strait of Hormuz.
The global average jet fuel price last week rose 7.1% compared to the week before to $209 per barrel.
The shutdown of the important waterway – of which around 20% of the world’s oil and liquefied natural gas usually passes through – has also put pressure on supplies.
Brindisi Airport in southern Italy ran out of fuel earlier this week, with none expected to be available until at least midday Wednesday.
Italian publication Heute reported that the shortage could last longer than this.
Other Italian airports, including Bologna, Milan Linate, Treviso and Venice, have introduced fuel limits to preserve supplies.
An aviation notice issued on Saturday said: “Due to limited fuel availability from Air BP Italia, refuelling services for operators contractually linked to the company may be subject to restrictions.”
Meanwhile, Air New Zealand this week announced more flight cancellations with “a small number of schedule changes for travel across May and June”.
The airline said the update affects around 4% of flights and 1% of total passengers due to travel across this period.
It said the “vast majority” of customers were being offered alternative flights on the same day.
The airline told 1news: “We have worked hard to keep disruption to a minimum, with the vast majority of impacted customers still travelling on the same day.”
“We remain focused on keeping New Zealanders connected and maintaining a reliable, fuel-efficient schedule.”
Air India and China Eastern Airlines have raised surcharges for domestic flights, while Korean Air said it has moved into emergency management mode and will implement cost-cutting measures.
Most airlines have bought enough in advance to ensure they had sufficient supplies, and without needing to pass on the higher price to passengers.
British Airways owner IAG and EasyJet say they brought their fuel before the war began, so have not had to pass on price increases to cutsomters.
However, Ryanair boss Michael O’Leary told Sky News last week that jet fuel supplies could start to be disrupted in May if the conflict continues.
The price of oil plunged and global stock markets recovered today after the US and Iran agreed a two-week ceasefire, which includes the reopening of the Strait of Hormuz.
The ceasefire followed threats by President Donald Trump on Tuesday that “a whole civilisation will die” unless Tehran met his demands.
Experts have suggested that the ceasefire may drive hopes that the increases in the cost of living are not “as painful” as many have been expecting.
Susannah Streeter, chief investment strategist at Wealth Club, said: “A wave of relief has hit financial markets after threats of a devastating escalation of the war were replaced by a temporary truce.
“The FTSE 100 has jumped on the open, on the back of sharp gains for indices in Asia.
“The two-week ceasefire is likely to be fraught with uncertainty but for now there are hopes that it will be a precursor to a longer-lasting agreement.
“There is a chance that the cost of living crisis consumers are already having to deal with may not be quite as painful.”
