Higher airfares inevitable due to high oil prices but they may come down later this year: Iata chief

Higher airfares for now are inevitable, with oil prices high and jet kerosene prices even higher at a time when jet fuel manufacturers have yet to return to pre-pandemic levels of production, said the DG of the IATA. Airlines have had to raise fares by at least 10 per cent just to offset the surge in fuel cost, their biggest expenditure outlay, Willie Walsh said. "Jet fuel prices are leading to very significant increases in costs for airlines. Given the financial performance of airlines, there is just no way an airline can absorb that additional cost," he said at a media briefing on Monday ahead of the Changi Aviation Summit this week. But there is no evidence the higher airfares have deterred people from travelling, Walsh noted. "There is strong pent-up demand for travel. People have saved money and they are prepared to spend that money." Airfares here and globally have surged with air traffic on the rebound. A return ticket on Singapore Airlines (SIA) to London from June 20 to July 10 is now going for about $3,200, up from $1,800 pre-pandemic. The fare increase has ranged from 20% to 80% since Singapore reopened its borders in April, amid passenger volumes doubling at Changi Airport to reach 40% of 2019 levels.<br/>