Asian airlines’ restarts still curbed by restrictions

Asia-Pacific airlines' plans to resume international flights have lent some support to jet fuel markets, although this is still subject to existing and potential travel restrictions as the Covid-19 pandemic evolves.

Asia-Pacific jet fuel refining margins measured against Dubai crude values have remained positive since 1 June, rising to more than a 2½-month high of $3.16/bl on 18 June before falling slightly to $2.77/bl the next day. But this is still far removed from the $12.12/bl average in January, just before the pandemic took hold.

While there are signs of more international flights resuming, they are still subject to travel restrictions like the 14-day quarantine for passenger arrivals still in place for most countries, along with any potential new restrictions as the pandemic evolves.

Pakistan's government has resumed international flights to and from all except two of its international airports starting 20 June, with roughly 200-275 inbound flights a week across the country. But this is still subject to potential restrictions and Covid-19-related health measures. Hong Kong-based Cathay Pacific has plans to increase its international flight frequencies to various destinations in Asia, America and Europe in July,although the airline said schedules are subject to change because of the evolving Covid-19 situation. Singapore Airlines has reinstated some international services this month and in July, although a 94pc reduction in originally scheduled passenger capacity remains. South Korean airlines, as well as Malaysia Airlines and Air New Zealand, are among other carriers with plans to resume international flights this month and July.

The International Air Transport Association reported a 98pc fall from a year earlier in Asia-Pacific airlines' international passenger demand in April but predicted a subsequent increase.

But obstacles to any future recovery include the cancellation of flights in and out of Beijing with its resurgence of coronavirus cases. Australia's national airline Qantas announced last week cancellations of all international flights until late October because of authorities' comments that international travel from Australia may not restart until 2021, although exceptions may be made for neighbouring New Zealand.

by Sarah Giam