Jet fuel prices surged to $150/barrel after the Iran war, up from $80/barrel in March 2026, triggering flight cuts across global low-cost carriers. Ryanair’s CEO warned of a 'domino wave of airline bankruptcies' in Europe. Southeast Asian LCCs reduced flights by ~20%, with AirAsia and VietJet cutting ~30% of seats. South Korean carriers eliminated over 1,200 round-trip flights in May–June. Middle East infrastructure damage — including at Ras Tanura, Fujairah, Duqm, and Ras Laffan — may require $58 billion in repairs and two-to-four-year turbine replacements. China approved 500,000 tons of refined fuel exports in May, a 56% rise from April.
According to economy.ac, jet fuel prices have surged to $150 per barrel following the outbreak of the Iran war — up from $80 per barrel in March 2026 — triggering emergency cost-containment measures across low-cost carriers (LCCs) worldwide.
Deteriorating Profitability Across the LCC Industry
Michael O’Leary, chief executive officer of Ryanair, Europe’s largest low-cost carrier, warned in a CNBC interview that “if oil prices remain high for a long period this summer, several European airlines will face severe financial difficulties.” He further told Bloomberg that “a domino wave of airline bankruptcies could occur across Europe,” naming Hungary’s Wizz Air and Latvia’s airBaltic as carriers at acute risk.
Southeast Asian LCCs have collectively reduced flights by about 20% compared with pre-war levels. Malaysia’s AirAsia and Vietnam’s VietJet cut seat capacity by around 30% each, while Indonesia’s Lion Air and Citilink reduced capacity by about 20%. In South Korea, Jeju Air cut 187 round-trip flights in May and June; Jin Air reduced 176 round trips across 14 routes; Eastar Jet cut 150 flights; Air Premia reduced 73 flights; Air Seoul plans to cut 51 round trips to Vietnam and Guam; and Air Busan reduced 212 round trips, with additional adjustments scheduled on eight routes including Busan-Da Nang and Incheon-Hong Kong.
Prolonged Disruption Expected in Crude Supply Chains
According to Al Jazeera, Saudi Arabia’s Ras Tanura refinery complex halted operations after a fire broke out in March due to debris from an intercepted Iranian drone. Similar incidents occurred at oil terminals in Fujairah and Musaffah in the United Arab Emirates. Oman’s Port of Duqm sustained strikes on fuel storage tanks and oil tankers, and Qatar’s Ras Laffan LNG facility suspended production following an Iranian attack.
Norwegian energy consultancy Rystad Energy estimates restoration and reconstruction costs for Middle East energy infrastructure could reach $58 billion. Maritime insurers have sharply reduced or suspended war-risk insurance coverage for vessels in the Gulf region, contributing to widespread vessel stranding near the Strait of Hormuz. Vessel diversions from the Strait have caused cascading delays in tanker allocation and loading schedules — with repair timelines for core process units, such as gas turbines, extended by existing global order backlogs of two to four years.
U.S., China and India Expand Jet Fuel Exports
According to Reuters, the Chinese government approved exports of refined fuels — including gasoline, diesel, and jet fuel — totaling 500,000 tons in May 2026. That volume represents a 56% increase over the April export estimate of 320,000 tons compiled by ship-tracking firm Vortexa. The approval followed requests from state-owned refiners seeking expanded overseas sales amid soaring refining margins. Beijing partially eased previously imposed restrictions on refined fuel exports — originally introduced to protect domestic energy security and stabilize supply.
- Ryanair CEO Michael O’Leary identified Wizz Air and airBaltic as carriers at risk of bankruptcy
- Southeast Asian LCCs cut ~20% of flights post-war; AirAsia and VietJet each cut ~30% of seats
- South Korean LCCs eliminated 1,200+ round-trip flights across May–June 2026
- Ras Tanura refinery, Fujairah terminal, Duqm port, and Ras Laffan LNG all suffered direct damage
- Chinese refined fuel exports rose to 500,000 tons in May — up 56% month-on-month
Source: economy.ac
Compiled from international media by the SCI.AI editorial team.
