IATA Expects Gradual Aviation Recovery In Gulf Amid Latest Development In West Asia

By Anas Abu Hassan

SINGAPORE, April 8 (Bernama) -- The International Air Transport Association (IATA) anticipates a gradual recovery for the aviation industry within a few months, particularly in the Gulf region, amid the recent developments in conflicts in West Asia.

 IATA director general Willie Walsh said that a fair assessment based on current information suggests the industry might see some easing of pressure from the fuel price hike should the Strait of Hormuz reopen in the near term.

He noted that while crude oil prices were eventually declining, jet fuel prices are expected to remain slightly elevated due to the current condition of refinery facilities in the region.  

“If it (Strait of Hormuz) were to reopen and remain open, it will still take a period of months to get back to where the supply needs to be, given the disruption to the refining capacity in West Asia, which is the critical part of the global supply of refined products.

 “It is not just jet fuel but for other products as well, so it will probably take months,” he said during a press conference on the sidelines of the IATA World Data Symposium (WDS) here on Wednesday.

 Walsh stated that the current challenges faced by the aviation industry are not as severe as those experienced during COVID-19, when capacity was reduced by 95 per cent due to border closures.

 “As we sit here today, this is a challenge that we have witnessed before in the industry, and all of the airlines have been taking sensible measures, but nobody knows what is going to happen in two or three months.

“Certainly the forward curve would suggest that the fuel price will come down and get back to where they broadly were this year,” he said.  

Commenting on the condition of aviation hubs in West Asia and its recovery process, Walsh noted that carriers in the region account for 14.6 per cent of the total international capacity in 2025, and as the conflict evolves, it has been shifted to outside of the region, as demonstrated by several airlines.

He emphasised that since the conflict erupted, the aviation industry has seen some airlines redeploying their assets from West Asia to operate via other regions, providing a short-term opportunity for European and Asian carriers to take up that capacity.

“However, there is no way they can replace the capacity that was provided by the Gulf carriers, so I see this as a temporary issue.

“The Gulf hub is expected to recover quickly because the underlying demand has been strong so far. In fact, every airline chief executive officer I speak with reports continued robust demand,” said Walsh.

He also said that the reduction of air travel capacity in the West Asia region is seen as a short-term impact on the overall global traffic.

Walsh said that a sudden 14.5 per cent reduction in flight capacity in the West Asia region is expected to temporarily affect global air travel numbers, with the abrupt, overnight change likely causing some disruption or a drop in traffic.

“However, March data is unlikely to fully capture the impact, with a clearer picture expected to emerge in April and May as more data becomes available,” said Walsh.

-- BERNAMA