EasyJet has warned that the ongoing conflict in the Middle East is impacting its profits, with fuel costs rising by £25 million in the past month alone. The budget airline expects to report a pre-tax loss of between £540 million and £560 million for the six months to March, up from £394 million in the same period last year.
The airline said it remained confident in its fuel supply, having hedged 70% of its needs for the rest of the financial year to September. However, it noted that each $100 movement in the spot price of jet fuel per metric tonne adds £40 million in costs for its unhedged supply, with prices currently around $800 higher than before the conflict began.
Chief executive Kenton Jarvis said demand remained strong in the short term, but customers were delaying bookings due to economic uncertainty. He dismissed speculation about potential flight cancellations, stating: 'We have visibility to the middle of May and we have no concerns.'
Jarvis acknowledged a 'general shortening of the booking window' as people wait until closer to departure to book. He noted that after an initial drop in bookings for destinations like Egypt, Turkey and Cyprus following a drone incident in Akrotiri, demand has started to recover, with some shift from the eastern Mediterranean to the western Mediterranean.
