Jet fuel shortages: IATA warns of supply risks in Asia and Europe, fares under pressure

IATA Director General Willie Walsh said airlines may face jet fuel shortages in parts of Asia and Europe. Walsh also said ticket prices were starting to show the impact. The warning came as fuel markets stayed tense after the West Asia conflict. Jet fuel is one of the biggest costs for airlines, and prices have climbed.

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In a statement released with IATA’s March passenger traffic report, Walsh said supply risks were growing. "Everybody's watching what's happening with jet fuel -- both supply and pricing. On the supply side, over the next few months, we could see shortages in parts of the world with high dependence on supplies from the Gulf, especially Asia and Europe,\" Walsh, the IATA Director General, said in a statement.

Jet fuel shortages and ticket prices

Walsh said the latest rise in jet fuel costs was feeding into air fares. \"According to Walsh, the extraordinarily high cost of jet fuel is increasingly being reflected in ticket prices.\" Walsh said March traffic and forward bookings had not fallen yet. Walsh added that it was unclear when high prices might change passenger choices.

Walsh said travel demand still looked steady for the peak season. \"So far, the summer is shaping up to be a normally busy time for travel. Thats positive news, but airline resilience is being tested and stabilising the supply and price of fuel is crucial,\" he said. Walsh linked the pressure to both supply disruption and wider geopolitical uncertainty.

Jet fuel shortages and slots flexibility

Walsh said regulators should be ready to offer airlines flexibility on airport slots. Walsh pointed to unusual limits on airspace capacity. Walsh also cited the risk of fuel rationing in some markets. Walsh said such steps could help airlines manage schedules if supply tightens.

Walsh is set to take over as the CEO of Indias largest carrier IndiGo in August. IATA represents more than 360 airlines worldwide. The member list includes IndiGo, Air India, Air India Express and SpiceJet. Walsh’s comments were included in the industry body’s regular traffic update.

Jet fuel shortages and Indian airlines stress

In India, the Federation of Indian Airlines wrote to the government on April 26. FIA represents Air India, IndiGo and SpiceJet. FIA said the airline sector was under extreme stress and near stopping operations. The group sought changes in ATF pricing and asked for financial support.

IATA reported that March demand rose despite cost pressure. Total demand, measured in Revenue Passenger Kilometers, increased 2.1 per cent year-on-year. Capacity, measured in Available Seat Kilometres, fell 1.7 per cent from a year earlier. The load factor reached 83.6 per cent, up 3.1 ppt versus March 2025.

The report indicated strong loads even as capacity stayed tighter than last year. Walsh’s statement flagged fuel supply and price stability as key near-term risks. Airlines continued to watch Gulf-linked supply lines closely, especially for Asia and Europe. Regulators and carriers were expected to plan for possible disruption.

With inputs from PTI