Singapore’s flag carrier reports its first quarterly loss since the Covid-19 crisis despite record revenue of $6.3bn in the three months to June 30. Revenue rises by $1.02bn on the same quarter a year earlier, yet the airline books a net loss of $84m, a $290m deterioration year-on-year. Management pins the result on an extra $1.1bn in fuel expenses and a $46m hit from Air India, where it holds a 25% stake. Jet fuel prices are now about 80% higher than a year ago, driven by conflict in the Middle East and supply disruptions.
Carriers across multiple regions are reporting the same pattern of strong demand overwhelmed by energy costs. Korean Air delivers a 26% jump in quarterly revenue but sees profit shrink by roughly a third over the same period. A similar squeeze hits Ryanair, which posts a 34% fall in first-quarter profit even as travel volumes recover. American Airlines drops its forecast for a $2.1bn full-year profit, citing an expected $5.7bn increase in its fuel bill.
Rising fuel prices hit airlines’ largest variable cost line, and the scale of the increases is now overwhelming previous cost-cutting and efficiency gains. Many carriers hedge part of their fuel exposure, but analysts note that dramatic moves like an 80% annual price jump erode the protection from those strategies. Higher ticket prices can offset some of the burden, although competitive pressure and demand sensitivity limit how far fares can climb. The sector is now wrestling with whether to absorb more pain on margins or risk deterring price-sensitive travellers just as demand finally normalises.
