Airlines worry over rising Jet fuel price

There is more cash pressure on domestic airlines over the skyrocketing price of Jet A1 as it rose by about 40 per cent since the beginning of this year. Previous report shows aviation fuel increased by 110 per cent in the last six years. Airline operators say the price of Jet A1 now increases on […]

There is more cash pressure on domestic airlines over the skyrocketing price of Jet A1 as it rose by about 40 per cent since the beginning of this year.

Previous report shows aviation fuel increased by 110 per cent in the last six years.

Airline operators say the price of Jet A1 now increases on a weekly basis as the price of crude oil goes up thereby increasing the operating cost of the airlines.

Daily Trust learnt that the product is sold for N310 per litre in Lagos as of yesterday while it is almost N330 up North.

As operators groan over the high cost of Jet A1, a major component of airlines’ operating cost, the International Air Transport Association (IATA), the body representing airlines globally, in its latest airlines’ financial monitor, confirmed the development.

“A sharp increase in jet fuel price has been putting an upward pressure on airlines’ operating costs and represents a risk to a further recovery in the industry’s profitability during Q4,” the IATA report released on Tuesday said.

The report said the situation with the jet fuel is slowing down recovery by airlines from the COVID-19 induced losses in the last one year.

Operators said the jet fuel price started with N220 early this year and rose to N310 and N330 eight months after and may reach N350 due to rising foreign exchange rate.

“This is the situation we find ourselves in and there is a limit to which we can actually increase ticket prices. Government really has to intervene,” an operator said.

Director of Engineering with Ibom Air, Engr. Lookman Animasaun said airlines are being suffocated by the skyrocketing price of Jet A1.

He said, “There has not been any stability in the jet fuel market. For instance, we started the year with N220 and now it is N310 in Lagos. Elsewhere it is more than that. Now the price is increasing every week.”