Low oil prices to save airlines billions

Passengers will demand lower airfares if oil prices stay low
If oil prices remain low this year, and there is every expectation that they will, airlines around the world could save $12 billion. But passengers will also expect cheaper fares.
Crude oil prices fell to a 12-year low in January, as global demand weakens and additional supply comes from Iran.
“If sustained, the most recent declines in oil prices would reduce the industry’s annual fuel bill by approximately US$12bn in 2016,” the International Air Transport Association says in its latest Financial Monitor report.”
However, airlines’ fuel hedging contracts may delay the benefits of the drop in oil prices, IATA added.
Passengers are already starting to see these cost savings have an effect on ticket prices, with average global airfares falling 12% year-on-year in the first 11 months of 2015 – when reported in US dollar terms. Once the appreciation of the dollar against other currencies is taken out of the equation, fares were just 5% lower.


Check Also

Air rage, airlines, alcohol, drunk passengers, drugs, IATA, recommendation, airport, shops, sale, easyJet, Jetstar

Severe air rage incidents on the rise

Most cases involve verbal abuse, many involve alcohol

airlines, air rage, flight attendant, cabin crew, job, union, USA, Bob Ross, association, protect, corporate, abuse, business, passengers

Air passenger demand to double in 20 years

World’s future fastest-growing markets identified

wi-fi, IFE, mobile, onboard, inflight, entertainment, air travel, airlines, IATA

Air passengers want Wi-Fi via own devices

Bring-your-own mobile device, taking over the skies

flights, air travel, Warsaw, Helsinki, Copenhagen, Finnair, Reykjavik, Billund, Legoland, Vilnius, China, frequencies, capacity

Air traffic demand strengthens again

Airlines in Europe and elsewhere see high demand

luggage, bags, baggage, air travel, airlines, ancillary, fees, online, book, travel, fly, flight, 2018, forecast, alliances

Radio-frequency tech could save airlines $3bn

Airline industry study upbeat about RFID baggage tracking

wildlife, tracking, tool, IATA, airlines, airports, Africa, Asia, trafficking, illegal

Airlines to deploy wildlife tracking tool

Wildlife tracking assessment tool to cut illegal shipments