High Oil Profits Put Asian Airlines at High Cost Risk
Asian airlines may raise ticket prices to lower the cost of high fuel prices, which could limit the rapid growth of aviation demand and drastically slash the most seasonal aviation fuel profit margins in five years, analysts said.
Profits from refiners producing aviation fuel are now at their highest levels since 2013, as airline profits soar as the region grows, cheap fares and increased route choices.
But aviation fuel prices,as one of the airline's main input costs, have also hovered at their highest level in nearly four years, dragging down the airline's balance sheet.
At present, the price of the Asian jet is about 16 US dollars more than Dubai crude oil, and the price of the aircraft is close to its highest level since December 2014.