IATA’s Jet Fuel Price Monitor, drawing on Platts refinery assessments, put the global average at $181.46 a barrel last week, up 6.1 percent on the week before. Eurocontrol’s Week 37 aviation overview recorded an average of $4.58 a gallon on 11 September, 18 percent above the prior two weeks, and said prices were moving back toward the April peak as the US–Iran conflict resumed. IATA is a worldwide refinery average. Eurocontrol is a European operational snapshot. US Gulf Coast spot sat near $4.55 a gallon on 17 September, New York near $4.75, both close to wartime highs. FBO pump prices are higher still. Use the IATA and Eurocontrol figures as published. They have now been checked against those organisations’ own pages. They still do not tell you which airline is in trouble.
The first routes to die are the ones that burn the most extra kerosene for the least extra fare. A long-haul that already flies a southern or Caspian dogleg because airspace is closed is a fuel problem twice with hours in the air and a thinner premium cabin if corporate traffic has already rerouted. A thin regional jet on a two-hour sector with an old engine and no hedge is a fuel problem once and that is often enough. American’s finance chief told a Morgan Stanley conference this week that fourth-quarter jet was about a dollar a gallon above the July plan, a hit he put near a billion dollars, and that December flying already looked shorter. United said some December flights would not operate if prices stayed high. Spirit had already stopped in May citing fuel and funding. That is the order of vulnerability unhedged, older metal, leisure-heavy, dollar-funded and sitting on a detour. Premium and corporate bookings are what the US majors said was still offsetting the bill. When that mix thins, the leisure tail comes off first.
India lives the same arithmetic in rupees and dollars. ATF can be 40 percent of cash cost and more when the crack is violent. The government’s price-stabilisation collar buys a benchmark for carriers that opt in. It does not buy a dollar lease or a Gulf overflight. IndiGo’s young A320neo family is the right side of a $180 barrel. Air India’s widebody long-haul into Europe and North America is the wrong side if every sector is longer than the flight plan that was filed in January. SpiceJet and the thinner regionals have less treasury and more of a fuel line. A UDAN hop that looked viable at $100 a barrel is a political route at $180. Hedging helps only for the months still covered. Dollar debt helps only if the rupee holds. Fare power helps only on city pairs with no cheap substitute. The first Indian frequencies to shrink will be the long, thin internationals that cannot recapture the extra hour in the ticket, and the regional turns that cannot raise a fare without emptying the cabin.
Winter is when this becomes a schedule. Watch which carriers publish a December cut, which lessors reprice mid-life metal and which governments keep the fuel collar in place. The barrel will be quoted every Monday. The route that disappears will be the one that could not pass the fuel through.