general

Airlines have been snapping up oil derivatives contracts to protect against higher prices in recent weeks as the Israel-Hamas war raises the spectre of a surge in fuel bills. Traders and brokers active in the oil market say consumer hedging activity has increased since the conflict broke out, and industry executives have confirmed those moves in earnings calls in the last few days. The flurry of activity is showing up in surging volumes of call options that help buyers protect against significantly higher prices.<br/>While oil has fallen back to pre-war levels as the conflict remains contained away from major crude-producing regions, airlines still see the risk of a spike in the price of the commodity that is typically their largest single expense. “We will build it up very quickly,” Air France-KLM CFO Steven Zaat said on an earnings call last week, referring to how soon his company would reach its desired hedging volume of 70 per cent of fuel consumption for early 2024. “We are close to that 70 per cent to make sure there’s no spike increase coming from what’s happening in Israel.” Airlines generally hedge their fuel bills using a variety of derivatives instruments, including options contracts and swaps. The strategy is not without its risks. Airlines lost billions of dollars on the practice during the Covid-19 pandemic, when the collapse in global travel left them with huge loss-making derivatives positions but no offsetting lower fuel bills as flights were grounded.<br/>

The US Senate Commerce Committee will hold a hearing next week on a series of troubling close-call aviation safety incidents that raised questions about FAA air traffic control operations. The Nov. 9 aviation subcommittee hearing, which was reported earlier by Reuters, will include FAA Air Traffic Organization head Tim Arel, National Transportation Safety Board Chair Jennifer Homendy, National Air Traffic Controllers Association (NATCA) President Rich Santa, Air Lines Pilots Association President Jason Ambrosi and former FAA administrator Randy Babbitt. The committee said it will examine "serious close calls across the National Airspace System and related efforts to improve the US aviation system's safety culture, processes and technologies." The NTSB has opened seven investigations into near-miss incidents since January, including some that were potentially catastrophic. "There have been far too many close calls and near-misses on our runways," Homendy said on Thursday during a speech. She noted the seven incidents this year "put more than 1,300 human lives at risk. ... These recent incidents must serve as a wake-up call for every single one of us, before something more catastrophic occurs." In August, a Southwest Airlines Boeing 737 and a Cessna Citation 560X business jet came less than 30 meters apart in San Diego. The FAA said an air traffic controller cleared the Cessna to land on a runway even though Southwest Flight 2493 had already been told to taxi onto the same runway.<br/>

The US National Transportation Safety Board (NTSB) will hold a roundtable discussion on pilot mental health after several recent incidents have come to light in which pilots apparently suffered mental breakdowns. In a speech to the Air Traffic Control Association’s Global Aviation Conference, NTSB chair Jennifer Homendy on 2 November said that often mental health issues among flight deck crew go unreported and untreated, leading to situations that could compromise aviation safety. She blames the FAA’s arcane rules on the subject as the primary reason. “It’s somewhat of an open secret that current rules incentivize people to either lie about their medical history when it comes to mental health or avoid seeking help in the first place,” she says in prepared remarks published by the NTSB. “I am frankly concerned about the safety consequences of a system that unintentionally shames and silences people who are struggling,” she adds. The event will be held on 6 December, the first of a series of events that will focus on US aviation safety. Homendy’s comments come just days after reports surfaced that a Delta Air Lines first officer in 2022 threatened a captain with a firearm during a commercial flight. He was indicted on 18 October and is set to be arraigned later this month. Last week, an off-duty Alaska Airlines pilot travelling in the cockpit jump seat on a flight to San Francisco from Seattle attempted to shut off the engines of the aircraft while it was in flight, forcing it to divert to Portland, Oregon. He claimed to have taken psychedelic mushrooms prior to the incident, and told law enforcement authorities that he was having a “nervous breakdown”. He has been charged with 83 counts of attempted murder. “Mental health doesn’t affect those in aviation any differently than it affects others around the world,” Homendy says. “We’re all human, which means we’re all affected by fatigue, illness, grief, and other work-related or personal stressors.” Pilot mental health – both in general aviation and commercial contexts – is a massive white elephant in the cockpit, say aviation medical professionals worldwide. That is because regulators hold all the power, and some say the system forces pilots to make unwise choices to avoid losing their permission to fly.<br/>

The United States on Thursday imposed sweeping new measures against Moscow over the war in Ukraine, targeting Russia's future energy capabilities, sanctions evasion and a suicide drone that has been a menace to Ukrainian troops and equipment, among others, in sanctions on hundreds of people and entities. The latest measures target a major entity involved in the development, operation and ownership of a massive project in Siberia known as Arctic-2 LNG, the State Department said in a statement. The project expected to ship chilled natural gas, known as liquefied natural gas to global markets. Washington also targeted the KUB-BLA and Lancet suicide drones being used by the Russian military in Ukraine, designating a network it accused of procuring items in support of their production as well as the creator and designer of the drones. The Biden administration on Thursday added a dozen Russian companies to a trade blacklist for supporting Russia's military with drones that could be used to aid in Moscow's invasion of Ukraine, the Commerce Department said. The US also cracked down on sanctions evasion in the United Arab Emirates, Turkey and China, as the Treasury Department said companies based in the countries continue to send high priority dual-use goods to Russia, including components Moscow relies on for its weapons systems. Among those designated on Thursday were Turkish and UAE firms, including companies that sent high-priority goods to Russia and firms that have shipped aviation parts and equipment.<br/>

Airlines without historic rights at Amsterdam's Schiphol airport, including newcomer JetBlue, will not be allocated slots for summer 2024, slot coordinator ACNL said on Thursday. Airlines which do have historic rights will receive 3.1% fewer slots than before, ACNL Director Hugo Thomassen told Reuters, as the Dutch government moves ahead with contested plans to limit the number of flights to and from the airport to reduce noise. U.S. carrier JetBlue in September filed a complaint against the Netherlands and the European Union with the US Department of Transportation over the plans to curb traffic at Schiphol, saying they violate the US-EU Air Transport Agreement. Last month it urged the same agency to ban Air France's KLM from New York's John F. Kennedy International Airport, in retaliation for the plans. "We believe the US and Dutch Governments have an obligation under our historic Open Skies Agreement to ensure that JetBlue is granted continued access at Amsterdam’s only viable airport," JetBlue said in an emailed response. The Dutch government aims to cut flights at Schiphol, one of Europe's main air transport hubs, to 452,500 per year, almost 10% below 2019 levels and lower than a previous proposal of 460,000. The move is fiercely contested by flag carrier KLM and industry groups. KLM said it was disappointed with the number of slots for the summer season. "This translates to a reduction of around 17 legs per day," spokesperson Gerrie Brand said.<br/>

Spanish airport operator Aena said on Thursday its net profit in the first nine months of the year jumped as passenger traffic in Spain surpassed pre-pandemic levels, pushing its share price up. The Spanish airport operator’s net profit rose 71% from the same period of last year to E1.14b while revenue between January and September grew 20% from the same period a year ago to E3.7b. Aena added it expects traffic will keep on growing through the winter following a strong summer, forecasting full-year traffic in 2023 to be 2% above the 275m passengers registered in 2019. The company had forecast a year ago traffic at 92% of pre-pandemic levels this year. It expects traffic will continue to grow to reach 300m in 2026. Aena’s financial results were in line with analysts’ expectations. “Aena’s cashflow is performing better than expected. The significant improvement in traffic levels, already above 2019, mainly in the most tourism areas, allows a strong rebound in revenues,” Angel Perez, an analyst at brokerage Renta4, said in a note to clients. Tourism worldwide strongly recovered in 2023 after a couple of years of COVID-19 pandemic restrictions. In Europe, the recovery was led by travellers from cooler climates seeking warmer temperatures in the south, according to the Spanish airline association. Traffic to other European countries, where business travel represents a bigger share, was still slightly below pre-pandemic levels.<br/>

No nation in the world is buying as many airplanes as India. Its largest airlines have ordered nearly 1,000 jets this year, committing tens of billions of dollars to a spending spree that is unparalleled in aviation. In New Delhi, Indira Gandhi International Airport will be ready for 109 million passengers next year, as it prepares to become the world’s second busiest, behind Hartsfield-Jackson Atlanta International Airport in the United States. And this is happening in a vast country still heavily reliant on trains — with 20 journeys by rail for every one by air. The enormous aviation build-out, with a surge of investment behind it, has pride of place in India’s case for a greater standing on the world stage. As it moves up the ranks of the world’s biggest economies, India is scrambling to meet the expanding ambitions of its ascendant middle class. Its airports present highly visible achievements. Air travel remains out of the financial reach of most Indians. An estimated 3% of the country’s population flies on a regular basis. But in a nation of 1.4b people, that percentage represents 42m — executives, students and engineers who yearn to get quickly from here to there inside India’s borders, and to gain easier access to destinations beyond, for both business and vacation. Kapil Kaul, the CE of CAPA India, an advisory firm focused on aviation, calls “the next two to three years critical for achieving the quality of growth that India desires and deserves.” Growth has so far been profitless. Now Indian aviation must prove it can make money. The effects of the spending spree should redound across India’s economy. Cargo comes with passenger traffic, and foreign investment tends to follow closely behind, Kaul said.<br/>

A woman has been arrested after allegedly running onto the tarmac at Canberra Airport in an apparent attempt to stop a flight from leaving without her. The ordeal was captured on camera as the woman allegedly ran past airport security onto the tarmac and under the plane, waving at the pilot to let her onto the QantasLink flight to Adelaide. The woman was arrested by the Australian Federal Police (AFP) on Wednesday at 7.30pm. Witnesses watched from the gate as the incident unfolded, surprised that no one stopped her. "People were a bit flat-footed, they didn't seem to know what to do, that was the weird part," Dennis Bilic, who recorded the incident, told 9News. "(We were thinking) 'Is anyone gonna stop her?'" Another witness, Simon Hales, said: "She's trying to yell at the pilot, she's trying to get his attention and jump up, it was bizarre." Hales took to Facebook after the incident to express his concern. Flights at the airport were delayed for about 10 minutes. All operations have now returned to normal. The AFP said it would provide more details "at an appropriate time". An investigation has been launched. <br/>

The union representing more than 6,000 pilots at FedEx Thursday said it is scheduled to restart contract talks with new leadership next week. The FedEx Master Executive Council, the governing body of the delivery firm's unit in the Air Line Pilots Association (ALPA), said on Monday it had elected Billy Wilson as its new chair after union members rejected a tentative contract with the company in July. The National Mediation Board affirmed its offer to convene an initial bargaining session between ALPA and FedEx management in Memphis on Nov. 6-7, the union told Reuters in an email. FedEx did not immediately respond to a request for comment. The tentative FedEx deal rejected by pilots included a 30% pay rise over four and a half years and a 30% increase to their legacy pensions, according to ALPA. Wilson has called for compensation that is commensurate with pilots at other airlines, where commercial pilots have won significant raises, reflecting their bargaining power in an era of staff shortages. The National Mediation Board affirmed its offer to convene an initial bargaining session between ALPA and FedEx management in Memphis on Nov. 6-7, the union told Reuters in an email. FedEx did not immediately respond to a request for comment. The tentative FedEx deal rejected by pilots included a 30% pay rise over four and a half years and a 30% increase to their legacy pensions, according to ALPA. Wilson has called for compensation that is commensurate with pilots at other airlines, where commercial pilots have won significant raises, reflecting their bargaining power in an era of staff shortages.<br/>

Boeing’s website selling spare aircraft parts, software and services was offline Thursday after the aerospace giant acknowledged it was dealing with a cyberattack. Customers visiting the official Boeing supplies web page were met with an image of a hard-hat and the Boeing logo and a notice that the company’s site and systems were down due to a cyber incident. It was unclear whether the hackers were responsible for taking down the website, or whether its removal was a defensive tactic by Boeing in a bid to prevent the intruders from accessing more data. A Boeing spokesperson couldn’t immediately be reached for comment. In the recent case of MGM Resorts International, which was targeted in a ransomware attack, the company decided to take down its consumer-facing websites to stop the intruders from gaining access to the systems behind them, MGM CEO Bill Hornbuckle told Bloomberg News last month in an interview. Boeing confirmed a cyberattack impacting its parts and distribution business on Wednesday, but added the incident didn’t impact flight safety. The company held conference calls with its airline customers on Thursday to brief them on the cyberattack at the parts unit, according to two people at US carriers familiar with the issue who asked not to be identified because the information wasn’t public. The unit was conducting business manually while its website was down, one of the people said. Lockbit, a criminal gang with ties to Russia, threatened last week to release “sensitive data” belonging to Arlington, Virginia-based Boeing if it didn’t pay a ransom by Nov. 2. The hackers placed the company’s name on its website, with a countdown to the day last week, but the name was no longer there on Wednesday.<br/>