WASHINGTON (TNND) — Travelers may see summer trips abroad upended if the Iran war’s damage to global oil trade isn’t remediated – and quickly.
Travelers may see summer trips abroad upended if the Iran war’s damage to global oil trade isn’t remediated – and quickly. (TNND)
“In Europe, we have maybe six weeks or so of jet fuel left. If we are not able to open the Strait of Hormuz (and) the refineries as a result start to work, I can tell you, soon we will hear the news that some of the flights from city A to city B might be canceled as a result of lack of jet fuel,” International Energy Agency Executive Director Fatih Birol said in an interview with the Associated Press Thursday.
Birol said additionally, if the Strait of Hormuz isn’t open by the end of May, economies around the world will “face huge challenges,” including petroleum product shortages.
“What is happening now is the largest energy crisis we have ever faced in history,” Birol said.
GasBuddy’s top petroleum analyst, Patrick De Haan, said the strait would need to reopen immediately to prevent Birol’s prediction from becoming reality.
You’re look at a time of transit, at least a couple of weeks. Refineries have to reheat and fire back up in China and India and once they receive that oil. There’s about a week (of) lag time to getting a refinery fully back online, and that’s with stable oil supply showing up. That’s not just with an oil supply here and there showing up – that’s not real feasible, either. They don’t want to restart their facility until they have at least a week or two of crude oil ready to go,” De Haan said.
If nothing changes, airlines may have to triage which flights can take off.
“t’s going to be tricky because it’s the (long-haul flights) that generally support tourism to a significant degree, yet it’s the long-hauls that see the most jet fuel consumption. You know, tens of thousands of gallons of jet fuel on a Boeing 777. You’d probably have to cancel 10 domestic Boeing 737 flights to get to parity with a Boeing 777,” De Haan said.
Rising jet fuel costs have already pushed some airlines to increase fees. Last week, Delta Air Lines rolled out a $10 increase for passengers on short-haul international flights to check their first two bags and a $50 increase to check a third, now costing $45, $55 and $200, respectively. United Airlines and Jet Blue also have also recently raised baggage fees.
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Last month, Delta CEO Ed Bastian told investors that since the beginning of the war, the rise in jet fuel prices had cost the company an additional $400 million.