Aviation executives are traveling to Rio de Janeiro this weekend for the annual Iata airline summit, even as the sector faces high fuel prices. The gathering comes as oil tankers remain affected by tensions involving the US, Israel and Iran, yet carriers have so far avoided major disruptions predicted for European summer travel. The choice of Rio signals renewed confidence after the event was canceled during the pandemic and held virtually in prior years. The host city was selected at the previous meeting in Delhi, where India’s prime minister highlighted the sector’s role in the national economy. At that time global traffic had recovered and fuel prices stood near 80 dollars per barrel. Prices have since risen above 140 dollars. Analysts note that fuel now accounts for over a quarter of airline operating costs, with each additional dollar per barrel adding roughly three billion dollars to yearly expenses. Airlines have cut about six percent of seats from schedules amid elevated costs and uneven demand. European carriers have maintained full operations ahead of peak season. New supply sources in the US and West Africa have eased shortages. The EU transport commissioner stated there is currently no jet fuel shortage in Europe and none is expected soon. Many major airlines use hedging to limit exposure to price swings. Budget carriers face greater pressure, with one low-cost airline pausing hedging due to volatility. Its falling share price has drawn takeover interest from a US investment firm. Gulf carriers have also been impacted by regional disruptions, including airport closures earlier in the year. Environmental topics are expected to receive less attention than usual, though efficiency gains remain linked to cost control. Sustainable aviation fuel continues to be discussed, yet production shortfalls persist. The Iata director general, who has advocated for such fuels, will step down after five years and join an Indian low-cost carrier that recently canceled a long-haul route due to fuel expenses. The organization has not confirmed whether a successor will be named at the Rio meeting.
