Major airline that flies from Heathrow cuts flights over huge fuel bill increase | World | News
Qantas said higher international airfares would only partially offset higher fuel costs.
The airline expects to pay between $3.1 billion and $3.3 billion (Australian dollars) for fuel in the six months to June 30 despite hedging its oil supplies, the Australian Financial Review reported.
The company cannot protect itself from five-fold increase in refinery costs.
This will add $600 million to $800 million (around £400 million) to Qantas’ expected fuel bill in the second half of the year, although this will be partially offset by better-than-previously expected earnings from international flights.
The airline expects to earn twice the revenue per available seat kilometer from international flights, a key measure for airlines after Middle Eastern airlines were forced to reduce services amid the conflict that has expanded to encompass the region. Iran attacked its neighbors in response to US-Israeli attacks.
High fuel costs and looming supply shortages have pushed Qantas to cut local and regional services. This reportedly includes reducing seating capacity by 5 percent in the coming weeks.
The airline will cancel flights that are not full and will increasingly consolidate services on busy capital routes.
“The group is working closely with the government and jet fuel suppliers as they continue to provide confidence in fuel supplies for the remainder of April and into May. We are monitoring the situation closely given the ongoing uncertainty in global fuel supply chains,” Qantas said in a statement. he said.
