Corporate travel buyers face a turbulent summer schedule after Lufthansa confirmed it will cancel 20,000 intra-European flights between May and October, blaming a doubling of jet fuel prices since the outbreak of the Iran conflict for rendering large swathes of its short-haul network “unprofitable”.
The German flag carrier said the cuts would conserve roughly 40,000 tonnes of kerosene across its hubs at Frankfurt, Munich, Zurich, Vienna, Brussels and Rome. The first 120 cancellations took effect on Monday, with the airline citing “significantly increased kerosene prices” alongside “additional burdens from labour disputes”. The move follows last week’s decision to retire the entire 27-strong fleet of regional subsidiary CityLine ahead of schedule, in response to surging fuel costs and constrained supply.
The Lufthansa announcement has heightened pressure on Westminster, with Airlines UK, the trade body representing British carriers, calling on ministers to act now or risk a summer of disruption for business and leisure travellers alike. The body warned of an “immediate impact on the UK aviation sector and UK consumers in the event disruption to jet fuel supply continues or worsens”.
Airlines UK is pushing for fuel reserves to be built up by directing British refineries to produce more kerosene, alongside expanded imports of US-grade Jet A fuel, which is compatible with some aircraft. The trade body has also asked the Treasury to cut aviation taxes and to suspend selected environmental regulations for the duration of the crisis.
The intervention comes as Brussels prepares to issue formal guidance to carriers on managing airport slots, passenger rights and public service obligations in the event of fuel shortages linked to the Iran war. Apostolos Tzitzikostas, the EU’s transport commissioner, said there were no shortages “as of today” but cautioned that a prolonged blockade of the Strait of Hormuz would be “catastrophic” for Europe and the wider global economy.
Roughly one-fifth of the world’s oil and liquefied natural gas transited Hormuz before the United States and Israel began strikes on Iran on 28 February. The EU imports between 30 and 40 per cent of its jet fuel requirement, with about half sourced from the Middle East. The European Commission is due to publish a broader package of energy and transport measures on Wednesday, including the launch of a new “fuel observatory” to monitor supplies, beginning with jet fuel.
“If real supply issues arise, our emergency stocks must be put to best use,” Tzitzikostas told reporters following a meeting of EU transport ministers. “Any national release of fuel must be done in full transparency to avoid market distortions.”
The commissioner reported no signs of “widespread cancellations” over the coming weeks, though the International Energy Agency warned last week that physical shortages could begin to bite as early as June. For now, European airlines are reporting elevated pricing rather than supply gaps. A spokesperson for IAG, parent of British Airways and Iberia, said the group was “not seeing disruption to jet fuel supply in our main airports, but our airlines are already facing rising fuel costs.”
German logistics group DHL said it had secured fuel for its European cargo operations into June, although the outlook for its Asian network remained uncertain — a warning sign for freight forwarders and corporate logistics teams reliant on intercontinental connectivity.
The Commission is also using the crisis to accelerate the rollout of sustainable aviation fuel (SAF) and synthetic fuels, in a bid to reduce dependency on Middle East imports. However, IATA warned last year that SAF production remains well below the level required to meet green fuel mandates, and continues to cost up to five times more than conventional kerosene.
The EU’s anti-tankering rules, designed to prevent airlines loading excess fuel at cheaper airports, already permit exemptions during shortages, with the Commission expected to clarify the framework this week. Brussels is additionally examining alternative imports, including US Jet A fuel, though its higher freezing point than the European standard presents technical considerations for operators.
Tzitzikostas sought to reassure the travelling public, insisting: “There is no need at this point to intervene in how people live, work or travel … Europe is ready to welcome all the tourists and guests during the summer period.” He added that elevated fuel prices would not, in themselves, justify waiving carriers’ obligations to compensate passengers for delays or cancellations — a point likely to be welcomed by corporate travel managers preparing for an unsettled peak season.