Australian airlines among most exposed if jet fuel supplies run dry

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Australian airlines could face major pressure if the Iran conflict continues to disrupt global fuel supplies, a new report warns.

Credit rating agency Morningstar DBRS says carriers in Australia, Asia, and parts of Europe are especially vulnerable due to their reliance on imported jet fuel.

The warning comes as tensions around the Strait of Hormuz continue to impact global supply. Around 20% of the world’s oil passes through this key route.

Since the conflict began in late February, jet fuel prices have nearly doubled. Airlines have already started passing these higher costs on to passengers through increased ticket prices.

Experts say airlines that locked in fuel prices earlier known as fuel hedging may be better protected in the short term. However, if supply shortages worsen, more carriers could be affected.

The report also highlights the risk of actual fuel shortages, especially if disruptions in the Middle East continue and major exporters limit supply.

Fuel is one of the biggest costs for airlines after staff, meaning any sustained increase or shortage could significantly impact operations and fares.

While a temporary ceasefire has eased immediate concerns, the situation remains uncertain.

Source : 9News

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