Airlines worldwide are adjusting ticket prices and scaling back flight capacity in response to a sudden spike in oil prices, a shift that could test the industry’s profitability if higher travel costs discourage passengers.

Prior to the escalation of the U.S.-Israeli conflict involving Iran last month, the aviation sector had projected record profits of $41 billion for 2026. However, a sharp increase in jet fuel costs—reportedly doubling in recent weeks—has disrupted those expectations, prompting carriers to reassess their operations and route networks.

Major airlines, including United Airlines, Air New Zealand, and Scandinavian Airlines, have already announced capacity reductions alongside fare increases. Others have introduced or expanded fuel surcharges to offset rising expenses.

Industry experts warn that airlines are facing conflicting pressures. Rigas Doganis, former head of Olympic Airways and a past director at easyJet, described the situation as a “perfect storm,” noting that carriers may need to lower fares to stimulate weakening demand even as higher fuel costs push them in the opposite direction.

The sector had enjoyed a strong recovery in 2025, with global passenger traffic reaching levels approximately 9% above those seen before the COVID-19 pandemic. Robust demand and supply-chain constraints, particularly delays in aircraft deliveries, had allowed airlines to maintain high seat occupancy and exert pricing power.

However, the scale of fare increases required to offset fuel costs could prove challenging, especially as households face higher gasoline prices that may limit discretionary spending on travel.

Analysts suggest capacity reductions may be the primary tool airlines use to support pricing. Andrew Lobbenberg, head of European transport equity research at Barclays, said cutting available seats is often the most effective way to drive fares higher during periods of crisis.

Airlines have already begun signaling the extent of potential fare hikes. The chief executive of United Airlines, Scott Kirby, recently indicated ticket prices may need to rise by around 20% to cover fuel costs.

Meanwhile, Cathay Pacific has increased fuel surcharges twice in the past month. From Wednesday, passengers flying return economy routes between Sydney and London will face an additional $800 surcharge, compared to a typical pre-crisis fare of about A$2,000 ($1,369.60).

Low-cost carriers are expected to be particularly vulnerable, as their customer base tends to be more sensitive to price increases. Analysts note that some travelers may shift to alternative transport options, such as rail or bus services, especially for short-haul journeys.

The current পরিস্থিত represents the fourth major oil shock for the aviation industry since the early 2000s. Previous disruptions occurred during the 2007–2008 pre-financial crisis period, following the Arab Spring in 2011, and after the outbreak of the Russia-Ukraine war in 2022.

This time, additional concerns have emerged over fuel supply security, particularly due to the closure of the Strait of Hormuz, a critical energy transit route. Airlines such as Vietnam Airlines have raised concerns about access to physical fuel supplies.

While airlines have sought to improve efficiency by modernizing fleets, supply-chain disruptions and technical issues with next-generation aircraft engines have delayed deliveries, limiting their ability to reduce fuel consumption.

Industry consolidation in the United States over the past decade has also reshaped the sector, with mergers such as Delta-Northwest and American Airlines-US Airways reducing the number of major carriers and enabling tighter capacity management. Meanwhile, low-cost operators like Ryanair and IndiGo have focused on streamlined fleets and rapid turnaround times to control costs.

According to aviation consultancy IBA, the current crisis is likely to widen the gap between stronger and weaker airlines. Companies with solid financial reserves and access to capital are expected to better withstand prolonged cost pressures, while those with weaker balance sheets may face growing financial strain.

Source: ZAWYA

Thai Airways International is set to relaunch nonstop daily flights between Bangkok's Suvarnabhumi Airport (BKK) and Amsterdam's Schiphol Airport (AMS) on July 1, 2026, marking the carrier's return to the Dutch market after nearly 28 years.

The service will utilize modern Airbus A350-900 aircraft as part of Thai Airways' Northern Summer 2026 schedule, with bookings now open following an announcement in early 2026.

This revival restores a historic long-haul link between Southeast Asia and Europe, last operated by Thai Airways in 1998 before the airline withdrew from the Netherlands.

The move aligns with Thai Airways' strategy to expand its European network amid post-restructuring growth, boosting tourism, business travel, and cultural ties between Thailand and the Netherlands while enhancing competition on the route.

By adding this daily connection, Thai Airways aims to strengthen overall Thailand-Europe connectivity, complementing partnerships like codeshares with carriers such as TAP Air Portugal for broader reach.

The resumption reflects confidence in demand from the Benelux region and supports the airline's long-haul ambitions.

flydubai has announced the launch of a new double-daily service to Bangkok, further strengthening its footprint in Thailand and increasing its total operations to the country to 28 weekly flights.

The new route will commence on 15 September 2026, operating from Terminal 3 at Dubai International Airport (DXB) to Don Mueang International Airport (DMK). The addition of Bangkok marks the airline’s second destination in Thailand, complementing its existing service to Krabi.

With this expansion, flydubai continues to enhance its network in Southeast Asia, which also includes destinations such as Langkawi and Penang in Malaysia. The carrier’s growing regional presence reflects sustained passenger demand for travel between Dubai and key leisure and business markets across Asia.

Don Mueang International Airport, located north of central Bangkok, serves as one of the Thai capital’s two international gateways. Its strategic location provides convenient access for both corporate and leisure travellers visiting Bangkok and surrounding provinces.

Commenting on the launch, Hamad Obaidalla, Chief Commercial Officer at flydubai, said:

“Thailand continues to be a highly popular destination for both leisure and business travel. The introduction of our double-daily Bangkok service reflects strong and consistent demand across our network. Operating from Terminal 3 at Dubai International and under our codeshare partnership with Emirates, passengers will benefit from seamless connections via Dubai to destinations across the GCC, Europe and other international markets.”

The new service further reinforces Dubai’s position as a leading global aviation hub. flydubai’s network now extends to more than 135 destinations, offering customers expanded travel options and convenient one-stop connectivity.

Sudhir Sreedharan, Divisional Senior Vice President of Commercial Operations at flydubai, added:

“We are pleased to expand our presence in Thailand with the launch of double-daily flights to Bangkok. We look forward to welcoming passengers on board and providing a comfortable and reliable travel experience in both Economy and Business Class.”

As part of its continued investment in customer experience, flydubai offers thoughtfully designed cabins across both classes. Passengers can enjoy comfortable seating, internationally inspired dining options and a wide selection of inflight entertainment available through the airline’s onboard system.

Flight Schedule (All Times Local)

From 15 September 2026, flydubai will operate the following services between Dubai and Bangkok:

• FZ1335: DXB 11:00 – DMK 20:45

• FZ1336: DMK 23:50 – DXB 03:20

• FZ1345: DXB 01:20 – DMK 11:10

• FZ1346: DMK 12:10 – DXB 15:40

Fares

• Return Business Class fares from DXB to DMK start from AED 9,000, while Economy Class Lite fares start from AED 2,500.

• From DMK to DXB, return Business Class fares start from THB 64,000, and Economy Class Lite fares from THB 22,000.

Flights are available for booking via flydubai.com, the official flydubai mobile application, the UAE Contact Centre, flydubai travel shops and authorised travel partners.

Xiamen Airlines will resume its direct flights between Quanzhou Jinjiang International Airport in Fujian and Mactan–Cebu International Airport in the Philippines starting 29 March 2026. The twice-weekly service will operate every Tuesday and Saturday using Boeing 737-800 aircraft, featuring eight business-class and 162 economy seats. The flight takes just under three hours.

The move, announced on 14 February, follows recent bilateral talks that granted new traffic rights and improved ground-handling support ahead of the summer season. The reinstated route reconnects Quanzhou—a major manufacturing hub for shoes, garments, and stone products—with Cebu, the commercial heart of the Visayas region. It’s expected to make business travel and supply-chain visits much easier for companies that previously relied on indirect routes via Xiamen or Manila.

Philippine President Ferdinand Marcos Jr. welcomed the restart, calling it a “new chapter” in people-to-people exchange. The Chinese Embassy in Manila also confirmed that Xiamen Airlines plans to increase flights on its Xiamen–Manila route to meet stronger demand. The announcement comes after the Philippines introduced a one-year visa-free entry scheme allowing Chinese citizens to stay up to 14 days for tourism or business.

For corporate travelers, the renewed direct link offers a more convenient route between Fujian’s export clusters and Cebu’s logistics, repair, and electronics sectors. It also supports greater accessibility to Mindanao, where several Chinese companies are currently involved in infrastructure projects. Filipino travelers should note that China has yet to introduce a reciprocal visa-free policy, so visas remain required except for short transits of up to 24 hours.

The service will also provide around five tonnes of cargo space per flight, which is expected to benefit e-commerce and high-value shipments like electronics and fashion samples. Freight forwarders are advised to secure space early, as the route typically maintains load factors above 80% during peak export periods.

Oman Air is set to introduce a new nonstop service linking Dubai with Salalah, beginning on July 3, 2026. The route will operate three times weekly throughout the year, further enhancing air connectivity to the Dhofar Governorate and offering greater travel convenience for both residents and international tourists ahead of the much-anticipated khareef season.

The addition of the new service reflects the growing demand for travel between Salalah and Dubai, while reinforcing Oman Air’s ongoing efforts to expand its domestic network and strengthen regional air corridors within the Gulf Cooperation Council (GCC).

Oman Air Chief Executive Officer Con Korfiatis described the new route as a strategic step in advancing the airline’s role in national development. “Launching the Dubai–Salalah service highlights our continuous investment in enhancing regional connectivity in line with Oman’s broader economic and tourism ambitions,” he said.

“We’re responding to strong market demand by increasing capacity and creating more travel opportunities that support tourism and business growth across Dhofar. Oman Air remains a key enabler of connectivity and economic diversification under Oman Vision 2040.”

Consistent with its growth strategy, Oman Air continues to scale up operations on key domestic routes. Seat capacity to Salalah has increased by 20% in January 2026 compared to the same period last year, following a 15% expansion during the 2025 khareef season to handle the surge in visitors. The airline also launched its first direct charter between Moscow and Salalah, expected to attract over 7,000 travelers from Russia and contribute strongly to Dhofar’s tourism and hospitality sectors.

In addition, Oman Air plans further network and schedule enhancements, including expanded services during Ramadan, to provide passengers with even more flexibility and travel options throughout the year.

Tickets for the new Dubai–Salalah route will be available from Monday, February 16, 2026, through www.omanair.com and the Oman Air mobile application.

AirAsia X is launching new routes from Kuala Lumpur to Bahrain and on to London Gatwick starting June 26, 2026. This move positions Bahrain as the airline's first global hub outside Asia.

The service connects Southeast Asia, the Middle East, and Europe via Bahrain's prime location and strong aviation setup. Bahrain-to-London becomes AirAsia X's second Fifth Freedom route, helping it tap into worldwide low-cost long-haul travel.

AirAsia X sees Bahrain as a springboard for growth, with opportunities for transit traffic and partnerships in cargo and maintenance. It fits the airline's push to link regions efficiently while keeping fares affordable.

Tony Fernandes, Capital A CEO and AirAsia X advisor, called it a key growth step. "Bahrain lets us link Asia, the Middle East, and Europe better, plus scale up cargo like Teleport after its $50 million raise," he said. He plans deeper ties with local airports and tourism groups.

Bahrain's Finance and National Economy Minister, Shaikh Salman bin Khalifa Al Khalifa, welcomed the deal. "It boosts jobs in aviation, tourism, and logistics, plus skills for Bahrainis in this growing field," he noted. Bahrain aims to solidify its role as a regional connector.