It’s the big question that the industry continues to debate as the conflict in the Middle East drags on. But for as long as a speedy resolution remains out of reach, airlines need to be implementing strategic long-term plans to manage rising fuel costs.
In an exclusive webinar for World Aviation Festival, renowned aviation consultant John Strickland shared his thoughts on the drawn-out crisis and discussed the different responses we’ve seen across the industry.
The reaction so far has been fairly calm: several airlines, including Ryanair and IAG, have been mostly sheltered from a serious cost crunch thanks to hedging strategies. easyJet even introduced a ‘Book With Confidence’ policy, advertising low fares and reassurance to encourage customers deterred by rumours of price spikes and potential cancellations.
One of the more serious cuts came at Lufthansa, which announced it was accelerating the closure of its CityLine subsidiary in response to rising fuel costs. But Strickland notes that the number of cancellations has so far remained modest thanks to close collaboration with fuel suppliers outside the Gulf:
Overall, at this point in time, we’re in a much better position than might have been expected.
The winter outlook: High ticket prices on the horizon?
Nevertheless, it looks like airlines will need to make some serious decisions heading into the winter season, in many regions of the world an off-peak period for air travel. Airlines might be able to lure passengers in with cheap tickets this summer, but in the long term fares will inevitably rise. Indeed, this fuel crisis may even have a permanent impact on pricing in the industry: Delta said they think they can keep charging customers at these higher rates even after the conflict subsides.
Strickland believes that cancellations are unavoidable going into the shoulder season:
Airlines in Europe and the USA normally would fly less in winter. They have quite a bit of spare capacity. The economics don’t make sense. No matter how much you could reduce prices to stimulate demand, you still wouldn’t be covering the cost of the higher price of fuel.
Recent years have seen airlines invest heavily in premium products in response to post-Covid ‘revenge travel’, as well as changing customer preferences. IATA reported last week that demand for front-of-plane seats went up by 4.5% from 2024 to 2025, a trend we can expect to see continue as airlines use the fuel crisis to extract maximum revenue from each aircraft.
However, in this difficult period, Strickland notes that airlines can’t afford to get carried away by premium investment, no matter how high-paying the customers:
If that demand for premium slips, and fuel prices remain high, if you’re not watching the cost side as well, then you’re getting yourself into a difficult and maybe dangerous place.
Strategies for improving efficiency
It’s been a year of musical chairs for aviation leadership, with a flurry of CEO resignations and replacements announced since the beginning of 2026. Air India, Air Canada, IndiGo, and IATA are just some of the organisations that will be under new direction by the year’s end. Managing the fuel crisis will be the top item in any CEO’s in-tray, and technology could find a way forward.
Fuel was already an airline’s biggest expense, but the current high prices have further accelerated aviation’s efficiency drive. In the coming months, we can expect to see an expansion in the use of AI and aerospace solutions to limit unnecessary fuel burn as much as possible. Strickland believes that extensive automation could help the industry act more collaboratively than in the past:
We have to break out of silos. AI, in many ways, forces that, because it can cut across organisations, both in levels and in functions. If people adopt that mindset, to work much better, to work more efficiently by sharing data, that means everybody’s better off. Airports are flowing more smoothly, airlines are more punctual, passengers are happier.
Airlines might shrink from the high price of incorporating more innovation into their business models, especially in as difficult a year as 2026. Strickland emphasises that it doesn’t matter if airlines are having a good year or a bad year: they have to invest in these solutions to survive, or their competitors will. And those that act decisively are the ones that will emerge strongest.
Technology is not something that is cheap, but it’s something that airlines have to invest in. There isn’t any other choice.
🎥 Access the webinar recording here to get the full session with John covering revenue management, aircraft orders, pricing strategies, and more.
Join us at World Aviation Festival 2026, where industry CEOs will be sharing how they’re reacting to the fuel crisis.
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