© depositphoto/jag_cz The culprit is the elevated price of aviation kerosene.
The aviation fuel predicament, spurred by the blockage of the Strait of Hormuz, is compelling prominent European airlines to diminish flights and ground aircraft, as reported by Politico, amid concerns about potential shortages.
Fatih Birol, the director of the International Energy Agency, stated on Thursday that Europe possesses approximately six weeks’ worth of aviation fuel reserves.
In tandem with this backdrop, the cost of aviation fuel in Europe has more than doubled since the commencement of hostilities in the Middle East on February 28.
Even though an actual scarcity of fuel has not yet materialized, its inflated cost is causing airlines to forgo less profitable routes and decommission older, less efficient aircraft.
Lufthansa revealed on Thursday that it will entirely discontinue the fleet of 27 aircraft belonging to its subsidiary, CityLine, this weekend.
While the group had intended to undertake this action earlier, having declared a gradual withdrawal commencing in 2024, the prevailing crisis is compelling an earlier implementation of this decision, according to CFO Till Streichert.
CityLine primarily facilitates connections between hubs in Frankfurt and Munich, linking them with various European destinations.
“This represents a regrettable measure,” Streichert conceded, alluding to prospective workforce reductions.
Furthermore, Lufthansa will decommission four Airbus A340-600 aircraft and two Boeing 747-400 aircraft from its intercontinental fleet by October.
The company also unveiled “further curtailments in capacity” within the winter 2026–2027 timetable, downsizing the fleet by an additional five aircraft.
The aggregate diminution amounts to 38 aircraft. Prior reports in German media in March had indicated a scheme to lessen the fleet by 40 aircraft.
“This action is unavoidable given the context of a substantial surge in kerosene costs and geopolitical volatility,” Streichert remarked. Jet fuel is derived from kerosene.
Nevertheless, Lufthansa is not the sole entity experiencing repercussions.
Soon after her announcement, KLM communicated that it would conduct 80 fewer flights to and from Schiphol Airport during May.
The Dutch carrier, a member of the Air France-KLM group, elucidated that these curtailments would impact routes featuring multiple daily flights, encompassing those to London and Dusseldorf, and would constitute less than 1% of the company's total European flights throughout this timeframe.
Diminishing fuel expenditures
Lufthansa indicated that approximately 80% of its fuel demands are safeguarded against elevated oil prices, but the remaining 20% must be procured at considerably heightened market values.
“It is precisely this particularly expensive portion of fuel expenses that will undergo a reduction of approximately 10%,” the company elaborated.
The German group also underscored escalating expenditures resulting from recent labor strikes, which overshadowed the airline's centenary commemorations on Wednesday.
Concurrently, the difficulties posed by mounting fuel prices are impacting not exclusively traditional carriers.
The budget airline easyJet divulged that its fuel outlays surged by nearly €29 million in March alone, and pre-tax deficits for the six months leading up to March could escalate to €620-640 million, in contrast to €450 million in the preceding year.
The Latvian airline airBaltic is similarly navigating a precarious scenario and is contingent upon monetary assistance.
Latvian Prime Minister Evika Silinja conveyed on Wednesday her willingness for the “disintegration of the coalition” owing to the reluctance of partners to consent to a €30 million loan sought by the company in late March.
While airBaltic's quandaries predated the conflict in the Middle East, the rating agency Fitch Ratings cautioned that spiraling fuel prices were intensifying pressure on the carrier's financial resources, observing that the company had only secured approximately 10% of its fuel prerequisites for 2026.
On Thursday, the Latvian government did endorse a loan for the airline.