By Ginika Igboke
The head of a global airline body said on April 8 that it could take months for jet fuel supplies to stabilize, even if Iran fully reopens the Strait of Hormuz.
Willie Walsh, director general of the International Air Transport Association, told reporters in Singapore that while crude oil prices may decline, jet fuel costs are expected to remain slightly elevated due to disruptions in refining capacity.
Jet fuel is one of the airline industry’s largest expenses, typically accounting for 25–30 percent of operating costs. Walsh explained that even with the reopening of the key shipping route, supply recovery would not be immediate.
“If it were to reopen and remain open, I think it will still take a period of months to get back to where supply needs to be, given the disruption to the refining capacity in the Middle East,” he said.
The aviation sector has been significantly affected by the Middle East conflict, which has disrupted major airport hubs, triggered thousands of flight cancellations, and driven up fuel costs globally.
However, Walsh emphasized that the situation is far less severe than the COVID-19 pandemic.
“In COVID, capacity reduced by 95 percent because borders closed. We’re nowhere near that,” he said.
Instead, he compared the current situation to past global disruptions such as the 2008 financial crisis and the aftermath of the Sept. 11, 2001, attacks.
“Post-9/11, the recovery took about four months. In 2008–2009, it was probably 10 to 12 months,” he said.
Walsh noted that the impact on Persian Gulf carriers—responsible for 14.6 percent of international capacity last year—would likely be temporary.
“Some of that capacity will be replaced by airlines outside of the region, but there’s no way they can replace the entire capacity that was provided by the Gulf carriers,” he said, adding that data from April and May would offer a clearer picture of the disruption’s scale.
“I fully expect the Gulf hubs to recover and recover quickly,” he added.
Oil prices remained above $110 per barrel on April 7 amid concerns of escalating tensions in the Middle East, after U.S. President Donald Trump set a deadline for Iran to reopen the Strait of Hormuz.
Brent crude futures rose 1 percent to $111.53 per barrel, while U.S. West Texas Intermediate (WTI) climbed 2.8 percent to $115.61.
Later that evening, Trump announced a suspension of planned military action against Iran. By April 8, oil prices had dropped sharply, with Brent crude falling more than 14 percent to below $94 per barrel and WTI declining 17 percent to around $96.
The announcement came shortly before an 8 p.m. ET deadline and followed a request from Pakistan to halt the attack.
“Based on conversations with Prime Minister Shehbaz Sharif and Field Marshal Asim Munir of Pakistan, and their request to hold off the planned strike on Iran, and subject to Iran agreeing to the complete, immediate, and safe reopening of the Strait of Hormuz, I have agreed to suspend military action for a period of two weeks,” Trump said in a post on Truth Social.
Iranian Foreign Minister Abbas Araghchi later issued a statement on behalf of Iran’s Supreme National Security Council, expressing appreciation to Pakistani officials for their mediation efforts.
“If attacks against Iran are halted, our armed forces will cease defensive operations,” the statement said. “For a period of two weeks, safe passage through the Strait of Hormuz will be possible, coordinated with Iran’s armed forces and subject to technical considerations.”
Pakistan played a key role as a mediator in the de-escalation efforts.
Meanwhile, Israeli Prime Minister Benjamin Netanyahu’s office clarified on April 8 that the temporary ceasefire between the United States and Iran would not affect Israel’s ongoing conflict with Hezbollah in Lebanon.
“The two-week ceasefire does not include Lebanon,” the statement said.
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