Even if the war against Iran reaches a negotiated solution in the coming days, the impact of the oil shock caused by the war is having an adverse impact on Canadian air travellers that is likely to continue throughout the summer.
The climbing cost of jet fuel has already resulted in flight cancellations. Air Canada has announced it is suspending flights from Montreal and Toronto to New York’s John F. Kennedy International Airport.
Meanwhile, Iran’s blockade in the Strait of Hormuz cut off 20 per cent of the world’s fuel stuck from getting to destinations around the world and drove up the price per barrel to a
s high as $200 a barrel. Earlier this week,
Fatih Birol, executive director of the International Energy Agency gave an interview to the Associated Press stating that Europe has “maybe six weeks or so” of remaining jet fuel supplies.
Oil prices plunged Friday after Iran said the Strait is open, but that declaration was tied by Iran’s foreign minister to the 10-day Israel-Lebannon ceasefire, which began Thursday evening. There are an estimated
in the Persian Gulf.
As
National Post reported previously
, the oil shock caused by the war is continuing to play out in the breakdown of the fuel supply chain. Dan McTeague, a gas prices analyst and president of Canadians for Affordable Energy, recently told National Post it will take months for the supply chain to stabilize.
John Gradek, an aviation industry specialist and lecturer at McGill University in Montreal told National Post that as fuel shortages hit airports in Europe and Asia, Canadian airlines will struggle to refuel and return. “The availability of fuel in Europe is going to be a big issue,” he told National Post last week, specifically for return flights. “It’s not what you can pay. You’re not going to be able to buy.”
BP Oil in Italy has already declared shortages in that country, he said. He predicted U.K. airports Heathrow and Gatwick will be next. As a result, he is predicting Canada-Europe flight cancellations.
Several international airlines such as Air France-KLM, Air India, Air New Zealand, Cathay Pacific, Lufthansa, United Airlines and Viet Nam Airlines have
.
However, Canadian airlines that operate international flights are not quite there yet.
“We are monitoring the situation closely, but we see no imminent impact on our operations due to a shortage of jet fuel,” Peter Fitzpatrick Air Canada’s manager of corporate communications told National Post in a Friday email. But he adds: “That said, jet fuel prices have doubled since the start of the Iran conflict and some lower profitability routes and flights are no longer economic, and we are making schedule adjustments accordingly.”
That means “removing overnight flights on routes where we have other (flights), such as Vancouver-Toronto.” He confirmed it also means “suspended service, such as Toronto and Montreal to JFK.”
Air Transat is not planning to reduce, consolidate, or cancel flights as a result of jet fuel supply constraints, Andream Gagne, senior director of communications and public affairs for the airline told the Post in an email.
However, she adds, as the “situation continues to evolve, we are closely monitoring developments related to global jet fuel supply, including in Europe. Our team is working in close collaboration with our partners to ensure reliable access to jet fuel at each of our European destinations. If adjustments were ever required, affected customers would be informed promptly and supported to minimize disruption.”
Similarly, WestJet is monitoring the global fuel situation closely, according to Julia Kaiser, media relations advisor at WestJet. She acknowledged changes may come this summer.
“We have not made any transatlantic or transpacific schedule changes at this time; however, we are evaluating our summer schedule and may adjust flying to balance fuel supply. We appreciate our guests’ understanding as we navigate these unprecedented and evolving supply chain pressures, and we remain committed to providing them with exceptional travel experiences.”
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