Airlines Warn of Possible Fare Increases Amidst Surging Aviation Fuel Costs

 

In response to the alarming surge in aviation fuel prices surpassing N1,300 per litre, airline operators are considering raising fares, signaling potential economic strains for passengers. This concern was articulated by Obiora Okonkwo, the spokesperson for local airlines, in a statement issued on Friday, where he urgently appealed for government intervention to avert the collapse of domestic carriers.

The sharp rise in fuel costs, coupled with currency volatility due to recent forex market unification measures, has disrupted operational stability within the aviation sector. The depreciation of the naira, exacerbated by dwindling oil production, has led to severe dollar scarcity, hindering local carriers' ability to obtain foreign exchange necessary for crucial maintenance of their fleets abroad.

Okonkwo, who also chairs United Nigeria Airlines, emphasized the detrimental impact of fuel price hikes and exchange rate fluctuations, resulting in significant losses for airlines. Passengers, even those who purchased tickets earlier at lower rates, are now being subjected to higher costs, further exacerbating the financial strain on airlines.

The broader economic ramifications are underscored by industry analysts who warn of reduced purchasing power among Nigerians if airfares are increased. Olumide Ohunayo, an industry expert, highlighted the inevitability of ticket price hikes as fuel costs constitute a substantial portion of airlines' operational expenses.

The impending fare increases could potentially dampen demand for air travel, with some passengers opting for cargo services due to prohibitive ticket prices. This development poses challenges for airlines already grappling with declining passenger traffic amid economic uncertainties, further jeopardizing their financial viability.

As the aviation sector navigates these challenges, stakeholders stress the urgent need for comprehensive government engagement and intervention to safeguard the industry's resilience and sustainability amidst prevailing economic headwinds.