The International Air Transport Association (IATA) chief recently warned that the prices of airline tickets are to go up “without doubt”, as fuel costs rise.
Oil prices have jumped as economies recover from the Covid-19 pandemic and also due to the war in Ukraine.
These costs will be passed onto consumers, Willie Walsh, director-general of the IATA said, the BBC reported.
“Flying will be more expensive for consumers, without a doubt,” he said, adding that the “high price of oil” would be “reflected in higher ticket prices”.
Due to the rise in fuel prices, domestic and international airfares have witnessed a surge of up to 50% in the past few months.
Airfares at American Airlines, Delta Air Lines and United Airlines – the three largest US domestic carriers – shot up nearly 50 percent for the week ending May 23 compared to a year ago, according to an analysis by Cowen, a financial services firm.
Cowen tracked nearly 300 routes across four different fare categories for the carriers using data from New York-based Harrell Associates, which tracks airline pricing trends, CBS reported.
Oil prices were already rising as demand picked up again in economies that had started recovering from the Covid-19 pandemic.
The fallout from the war in Ukraine has pushed prices up further.
The US has announced a complete ban on oil imports from Russia, while the UK is to phase out Russian supplies by the end of the year, the BBC reported.
European Union leaders have said they will block most Russian oil imports by the end of 2022.
This means demand for oil from other producers has increased, leading to higher prices.
Walsh said fuel prices were at record highs, and that “oil is the single biggest element of an airline’s cost base”, the BBC reported.
“It’s inevitable that ultimately the high oil prices will be passed on to consumers in higher ticket prices.”
International revenue passenger kilometres (RPKs) continued to drive the global industry’s recovery in May while the global domestic market trended sideways, IATA said.
Several major international route areas over-performed 2019 levels, while many others likely reached pre-pandemic RPK levels in June.