TOKYO, April 30 (Reuters) – Japan’s two biggest airlines, ANA Holdings and Japan Airlines (JAL), said on Thursday the Middle East conflict is keeping fuel costs elevated and the outlook uncertain.
Executives from the airlines, however, said there is no sign of near-term supply disruption, with those at ANA adding that the impact from the conflict should ease later this year.
• ANA CEO Koji Shibata said the impact from Middle East tensions is expected to fade gradually from the July-September quarter, with conditions normalising in the second half of the financial year.
• Shibata said fuel assumptions vary by quarter, but there are currently no plans for flight cuts or cancellations due to fuel shortages.
• ANA estimates higher fuel prices will lift costs by about 140 billion yen ($872 million) this year, though hedging, fares and cost cuts are expected to limit the impact to around 60 billion yen.
• ANA CFO Kimihiro Nakahori said roughly 90% of domestic fuel needs are already hedged.
• ANA added it is considering introducing a domestic fuel surcharge in the financial year starting April 2027.
• JAL CFO Yuji Saito said the company sees no problems securing jet fuel for international flights in May, and that there are no supply issues for domestic operations.
• JAL estimates fuel costs rise by about 28 billion yen per month if Singapore kerosene prices average $200 a barrel and the yen trades at 160 to the dollar, but government support, stronger revenue and fuel surcharges would offset part of the impact.
• Saito said demand across international and domestic passenger routes, cargo operations and low-cost carriers remains very strong, with bookings and fares exceeding expectations.
($1 = 160.4700 yen)
(Reporting by Maki Shiraki. Writing by Daniel Leussink. Editing by Mark Potter)
