With each day that passes since the start of war between the US, Israel and Iran, the impact on travellers increases. Many airlines are cutting flights and adding fuel surcharges.
EU energy commissioner Dan Jorgensen told Sky News many people would be hit by the high price and low availability of aviation fuel. “Unfortunately, it’s very likely that many people’s holidays will be affected, either because of flight cancellations or very, very expensive tickets,” he said.
“Even if we do everything we can, if the jet fuel is not there, then it’s not there.”
Lufthansa of Germany has grounded 20,000 flights as the cost of aviation fuel soars.
But in Britain, the situation is considerably less dire and UK airlines are not reporting a shortage of fuel.
Could your holiday flight be cancelled due to lack of fuel, or because the price has risen so sharply? That is the question increasingly many people are asking – and wondering about their rights amid such uncertainty.
These are the key questions and answers.
How bad is the fuel shortage?
In some parts of the world, particularly in Asia, flight cuts have been deep and steep surcharges have been added to air fares.
So far the impact on British passengers has been limited. Airlines UK, representing the main carriers, says:“Airlines continue to operate normally and are not experiencing issues with jet fuel supply.”
A government spokesperson said: “UK airlines are clear that they are not currently seeing a shortage of jet fuel. Aviation fuel is typically bought in advance, and airports and their suppliers keep stocks of bunkered fuel to support their resilience.
“We are continuing to work with fuel suppliers, airlines and international counterparts to keep flights operating, as well as planning for a range of contingencies.”
A spokesperson for Europe’s biggest budget airline, Ryanair, said: “We don’t expect any near-term fuel shortages, but the situation is fluid. At present our fuel suppliers can guarantee supply to mid-end May. If the Iran war finishes soon then supply will not be disrupted. If the closure of the Hormuz Straits continues into May or June then we cannot rule out risks to fuel supplies at some airports in Europe.”
The small Channel Islands airline, Aurigny, has grounded some flights linking Britain with Guernsey and applied a £2 surcharge on new bookings. Skybus, the Isles of Scilly carrier, has axed its link between London Gatwick and Newquay in Cornwall.
Oddly at the same time as fuel is getting scarce, European airlines including British Airways and Virgin Atlantic are stepping up flights to Asia, to cash in on the inability of the Gulf airlines to operate full schedules – and the reluctance of passengers to change planes in hubs which are on the Foreign Office no-go list – including Dubai, Abu Dhabi and Doha.
What happens if my flight is cancelled?
Under air passengers’ rights rules, travellers whose flights are departing from the UK or the EU – or on British or European airlines from anywhere in the world – have strong rights. They are entitled to be flown to their destination as close to the original schedule as possible, on any airline with seats available, and to be provided with meals and hotels if there is a significant delay.
If you are informed about a cancellation less than two weeks ahead, and the airline cannot find an alternative close to the original timing, the presumption is that you should be given between £220 and £520 in cash compensation. But carriers are likely to argue that the aviation fuel situation constitutes “extraordinary circumstances” and refuse a payout.
The most precarious situation is for travellers booked to return to the UK from beyond Europe on a non-British or EU airline. Air passengers’ rights rules do not apply, meaning the carrier has no obligation to provide an alternative flight nor offer a hotel.
An example would be Qatar Airways from somewhere in Asia, Africa or Australia. The carrier does not need to offer anything beyond a flight on a day to suit it; no obligation to provide a hotel or meals. Crucially, a number of people who book on British Airways via Doha may not be aware that Qatar Airways is doing the flying – and therefore does not to comply with UK air passengers’ rights rules.
Can I get travel insurance to cover cancellations?
Surely travellers should be able to insure against a potentially expensive risk, such as a flight cancellation resulting in the loss of prepaid hotels or car rental?
Well, I can see a few problems in obtaining such cover. I am not aware of policies that specifically cover such consequential losses. But if they do exist, the problem is this: because airlines have started to cancel flights in large numbers, insurers may regard the possibility of your departure being grounded as a “known risk”, and therefore refuse cover for such an event.
What about an existing policy? Most exclude paying out for losses incurred as a result of “declared or undeclared war or hostilities”. The current shortage of, and high prices for, aviation fuel is a direct consequence of the US-Israeli assault on Iran and subsequent retaliation. So I imagine any attempt to claim may be rejected.
Happily, though, I believe this discussion is purely academic. If airlines choose to cut back (or are ordered to do so), the presumption from the Civil Aviation Authority is that you will be rebooked on another flight to get you to your destination on the same day.
Could we face surcharges?
All the big airlines operating from the UK – British Airways, easyJet, Jet2, Ryanair and Virgin Atlantic – have locked into lower fuel prices with a practice known as “hedging”. That means committing to buy a specific amount of fuel at a fixed price. That enables them to swerve the worst effects of the surging cost of oil.
None of the airlines intends to surcharge existing passengers. There is no convention of asking people who have paid in full for their flights to pay more. However, that’s not the case for package holidays.
Under the Package Travel Regulations, travel firms are allowed to ask for more money if “the price of the carriage of passengers resulting from the cost of fuel” has risen. Hedging the price of fuel comes at a cost and plenty of firms choose not to lock into low fares. They are therefore exposed to the full weight of the approximate doubling of the oil price.
There is no upper limit to the amount that the travel firm can demand. But if the proposed surcharge is eight per cent or more, then you have the right to get your money back.
Many surcharges turn out to be eight per cent, representing an extra £80 on a £1,000 holiday.
Will we be paying more for flights later in the year?
Yes. One reason is displaced demand from the effective closure of the Gulf destinations of Abu Dhabi, Doha and Dubai. Holidaymakers whose plans have been disrupted by the Foreign Office advice against travel are instead looking for European locations, driving up prices.
In addition, many airlines are imposing fuel surcharges on new bookings. They range from £2 per flight for the small Channel Islands airline Aurigny to £260 on Japan Airlines.
Longer term, sustained higher fares are likely. As airlines’ fuel hedging arrangements unwind, future supplies will be more expensive – pushing up costs and therefore fares.
Kenton Jarvis, chief executive of easyJet, told The Independent: “The industry has no choice. It’s a low-margin, highly competitive sector. We make about £7 per seat. If fuel goes up £10, you have to respond.”
One exception could be a flood of cheap deals to the Gulf and beyond to Asia, Australasia and Africa. Emirates, Etihad and Qatar Airways are keen to fill their planes and boost confidence, and may cut fares below the rest of the market.
Should I book now for summer or wait?
I advise committing to the flights you will take over the coming months in the knowledge that you will get strong consumer protection. For example I have just bought a one-way flight from Luton to Mykonos in July – during the peak summer spell – for £106. Before that, I am travelling on easyJet from Gatwick to Rennes in May for £36.
I fully expect those flights to go ahead, but should the airline cancel I know that under air passenger rights rules, the carrier has to provide an alternative departure for me at no extra cost.
This piece has been updated with the latest information
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