Qatar Airways to be biggest victim in Gulf diplomatic breakdown

Qatar’s state airline is set to become the biggest loser from the diplomatic breakdown in the Persian Gulf—with competitors in Dubai and Abu Dhabi also set to suffer. Some 76 daily flights are likely to be grounded, of which 52 are operated by Qatar Airways, after Saudi Arabia, Bahrain, Egypt and the United Arab Emirates suspended ties with Qatar, according to data from scheduling firm OAG. Some 30% of the carrier’s revenue could be affected, aviation analysts at Frost & Sullivan estimate. Among Qatar Airways operations set to be shut is a shuttle to Dubai that operates 14 times a day. Plans to bar Qatari jets from entering airspace over the countries that could be even more problematic, inflating expenses by forcing significant diversions and putting the viability of some routes in jeopardy. “Diverting around closed airspace means higher fuel costs and longer flight times,” said Mark Martin, head of Dubai-based Martin Consulting. “Destinations in Africa and across the Indian Ocean may no longer be sustainable as part of the Qatar Airways network.” Earnings at Qatar Air, like other Gulf carriers, are already being squeezed as the low price of crude weighs on economic growth in the region and hurts demand for travel among oil-industry executives. An American ban on people using laptops aboard U.S.-bound flights amid concern about potential terrorist attacks is also taking a toll on business-class demand. The Saudi bar on flights was to be introduced immediately Monday, with the airspace ban taking effect Tuesday. Egypt and Bahrain have also stated that overflying their territory will be denied to Qatari carriers, though the U.A.E. has indicated that its airspace will remain open. Qatar Air declined to comment, beyond saying that it has suspended Saudi services.<br/>