IATA Warns of Months of Jet Fuel Disruption Despite US-Iran Ceasefire

Willie Walsh, director general of the International Air Transport Association, warned Wednesday that jet fuel supplies will take months to normalize despite a two-week ceasefire announced by U.S. President Donald Trump between the United States and Iran. Walsh made the remarks at a press conference on the sidelines of the IATA World Data Symposium in Singapore. The truce, announced Tuesday evening, is linked to the immediate and safe reopening of the Strait of Hormuz, which has remained practically closed to traffic since the conflict began. Oil prices fell by up to 16 percent, dropping below $100 per barrel, following the ceasefire announcement. Airline stocks surged globally on the news, with some carriers gaining between 8 and 14 percent in a single session. Walsh acknowledged the ceasefire as a positive development but cautioned that the underlying supply chain damage cannot be undone quickly.

Damaged refineries, not crude supply, are the core problem Walsh explained that the central obstacle to fuel normalization is not the flow of crude oil itself but the destruction of refining capacity across the Middle East. „If it were to reopen and remain open, I think it will still take a period of months to get back to where supply needs to be given the disruption to the refining capacity in the Middle East.” — Willie Walsh via Reuters Walsh added that the concentration of global refining infrastructure in the region had been underappreciated before the conflict. „I don't think everybody fully understood how concentrated refining capacity was in certain parts of the world.” — Willie Walsh via France 24 Even a resumption of crude flows would not immediately translate into available jet fuel, he said, because damaged refineries represent a bottleneck that cannot be bypassed. Walsh identified Asia as the region most exposed to near-term supply shortages, followed by Africa and Europe. The IATA World Data Symposium in Singapore provided the backdrop for Walsh's remarks, which drew wide attention from carriers already struggling with the fuel crisis.

Jet fuel prices more than doubled, airfare hikes called inevitable Jet fuel prices have more than doubled since the conflict began on February 28, 2026, far outpacing a roughly 50 percent rise in crude oil prices recorded before the ceasefire announcement. Walsh said higher airfares are inevitable given the sustained elevation of kerosene costs. „When the price of crude oil is down 16 percent, you'd like to think the kerosene price will fall to a similar extent, but it's still going to stay high, which in turn will lead to higher ticket prices. That's inevitable.” — Willie Walsh via Bloomberg Television Airlines worldwide have already been cutting flights, carrying extra fuel from home airports, and adding refuelling stops to cope with the squeeze. Malaysia's low-cost carrier AirAsia X raised its fares by up to 40 percent, according to Bloomberg, while United Airlines reduced planned capacity by around five percent. Air New Zealand cut its flight schedules for a second time and raised prices again. Fuel is the second-largest expense for airlines after labour, typically accounting for around 27 percent of operating expenses, according to IATA.

27% (of operating expenses) — Jet fuel's typical share of airline costs

Wizz Air: 14, Air France-KLM: 14, IAG: 10, Ryanair: 10, Lufthansa: 8, IndiGo: 10, Qantas: 9, Cathay Pacific: 5, Air New Zealand: 4

Walsh rejects COVID comparison, cites 9/11 and 2008 as closer parallels Walsh pushed back against comparisons between the current crisis and the COVID-19 pandemic, which reduced global aviation capacity by 95 percent as borders closed worldwide. „This is not similar to covid. This is not a crisis anywhere close to what we experienced in covid. In covid, capacity reduced by 95% because borders closed. We're nowhere near that.” — Willie Walsh via Irish Examiner He instead compared the situation to the aftermath of the September 11, 2001 attacks, after which recovery took approximately four months, and to the 2008-2009 economic downturn, which took between 10 and 12 months for the sector to absorb. Walsh expressed confidence that Gulf aviation hubs would recover, and quickly, once conditions stabilize. Gulf carriers accounted for 14.6 percent of international aviation capacity last year, and Walsh acknowledged that airlines outside the region cannot fully replace that capacity in the interim. The CEO of Malaysia Aviation Group, Nasaruddin Bakar, echoed Walsh's cautious outlook at the same symposium, saying that even if the war stops, many months will pass before prices stabilize. Thai Airways chief Chai Eamsiri described the current oil price shock as the worst of his career.

The US-Israel offensive against Iran, known as Operation Epic Fury, began on February 28, 2026. The conflict led to the closure of the Strait of Hormuz, through which approximately one-fifth of the world's oil trade normally flows. Reciprocal attacks on oil and refining infrastructure across the Gulf compounded the supply disruption beyond the closure of the waterway itself. The ceasefire announced by President Trump on April 7, 2026, came shortly before the expiration of a U.S. ultimatum to Iran.