Passenger Rights Stay In Force
Airlines that cancel flights this summer because of jet fuel shortages or high fuel prices will still have to compensate passengers under European law, according to EU transport commissioner Apostolos Tzitzikostas. His remarks place fresh pressure on carriers as the aviation sector faces a sharp rise in operating costs caused by the Iran war.
Tzitzikostas said jet fuel prices do not qualify as extraordinary circumstances under EU passenger rights rules. That means airlines cancelling flights for fuel-related financial reasons would still be required to reimburse travelers and meet compensation obligations.
Fuel Prices Do Not Count As Extraordinary
The commissioner told the Financial Times that if flights are cancelled because of jet fuel prices, airlines cannot avoid passenger claims by presenting fuel costs as an extraordinary event. His position reinforces the EU’s strict approach to consumer protection in aviation.
The issue matters because carriers are under growing pressure to adjust schedules as fuel prices rise. If airlines reduce capacity to protect margins, they may still face compensation costs, adding another financial burden to an already difficult summer travel season.
UK Rules Could Diverge After Brexit
Although EU passenger law remains in place in the United Kingdom after Brexit, Keir Starmer’s government is free to adopt a different position. Last week, it emerged that penalties for airlines cancelling UK flights because of jet fuel shortages had been eased.
The UK government said airlines are not currently seeing a shortage of jet fuel. It added that aviation fuel is usually bought in advance and that airports and suppliers maintain fuel stocks to support resilience. Officials said they continue to work with fuel suppliers, airports, airlines and international partners to keep flights operating.
Ryanair Says It Will Not Cut Flights
Ryanair said it does not plan to cancel summer flights because it hedged fuel contracts before the Iran war began. The airline said it has hedged 80% of its jet fuel needs through March 2027 at 67 dollars per barrel, less than half current spot prices.
That protection gives Ryanair an advantage over carriers with less fuel hedging. Other airlines, including Lufthansa and Aer Lingus, have already cancelled flights, showing how unevenly the fuel shock is affecting the sector.
AirAsia Warns Of Severe Cost Shock
AirAsia chief executive Tony Fernandes said the current fuel crisis is worse than the Covid pandemic for the airline industry. He said the sharp rise in jet fuel costs has created a major operating shock, with the company’s largest cost increasing dramatically in a short period.
Fuel prices have spiked since February 28, when the United States and Israel launched their war on Iran. The effective closure of the Strait of Hormuz has restricted oil exports from the Middle East, pushing up energy costs across aviation and other transport sectors.
AirAsia Still Commits To Expansion
Despite the fuel crisis, AirAsia is moving ahead with long-term growth plans. The airline has agreed a 19 billion dollar deal to buy 150 Airbus A220-300 jets from 2028, with the possibility of doubling the order if future demand supports expansion.
The order, announced at Airbus’s facility in Mirabel near Montreal, is described as the largest in Canadian aircraft history. It could also support years of work at the Short Brothers plant in Belfast, which produces wings for the Airbus A220. For investors, the sector now faces a split picture: near-term fuel pressure and compensation risk, but continued long-term confidence in air travel demand.
