Air Canada to suspend some flights to New York’s JFK over jet fuel costs

Air Canada said Friday it will suspend its flights from Toronto and Montreal to New York’s John F. Kennedy International Airport later this year due to surging jet fuel costs.

The airline said in an email the suspension will begin on June 1, with plans to resume on Oct. 25.

“As we regularly do, we monitor and review our network to ensure that routes are meeting profitability targets,” an Air Canada spokesperson said.

“As jet fuel prices have doubled since the start of the Iran conflict and some lower profitability routes and flights are no longer economic, we are making schedule adjustments accordingly.”

Customers affected by the suspensions will be contacted with alternate travel plans, the spokesperson said.

The airline will continue to offer service to New York’s LaGuardia Airport and Newark Liberty International Airport in New Jersey from six cities, including Toronto and Montreal.

Air Canada joins the ranks of Lufthansa, KLM and other carriers across the globe that have had to trim their flight schedules as skyrocketing jet fuel costs render some routes unprofitable.

Jet fuel — a refined kerosene-based oil product — is airlines’ biggest cost, making up about 30 per cent of overall expenses, according to the International Air Transport Association.

5:00 Europe running out of jet fuel

The average price for a gallon of jet fuel reached US$4.32 on Thursday, up from US$2.50 the day before the war in Iran broke out, according to Argus Media.

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A number of airlines, including WestJet, have added fuel surcharges or raised their airfares and other fees to account for the higher fuel costs.

Air Canada announced higher baggage fees this week — to $45 from $35 for the first checked bag in its basic economy class on domestic, U.S. and sun destination flights, for example.

Delta Air said this month that the tab for higher fuel would add $2 billion to its second-quarter costs.

4:07 Airlines adding fuel surcharge to flight bookings

Energy prices have soared over the course of the U.S.-Israeli war with Iran, which choked off oil shipments through the Strait of Hormuz in response.

Fatih Birol, the head of the International Energy Agency, told The Associated Press on Thursday that Europe has “maybe six weeks or so” of remaining jet fuel supplies and warned of flight cancellations “soon” if the blockade continued.

Typically, the Middle East supplies three-quarters of Europe’s net imports of jet fuel, according to the International Energy Agency.

John Gradek, an aviation expert and professor at McGill University, said Canada has seven specialized refineries that produce 85 per cent of the jet fuel used for Canadian air service, while the remaining 15 per cent is largely sourced from the U.S.

“We’re in pretty good shape in Canada” compared to Europe, he told Global News.

Iran and U.S. President Donald Trump announced Friday that the Strait of Hormuz would reopen amid a ceasefire between the two countries, as well as between Israel and Lebanon.

The announcement sent oil prices plunging by about 10 per cent and raised hopes about relief from the fuel cost crisis.

Gradek, however, said it will still take about two months to get airline fuel supplies back to normal levels — so long as the Strait remains open.

“We may have a couple weeks … of shortages,” he said.

Unlike previous instances where the airline industry faced cost pressures — including the 1970s energy crisis, the Sept. 11, 2001 terrorist attacks, the 2008 financial crisis and the COVID-19 pandemic — Gradek said “we’ve never had this before” where the crisis was due to fuel supply issues.

“This is the first time in the industry that we’ve really had a choking off of aviation fuel, and the industry wasn’t necessarily ready for it,” he said.

He pointed to this summer’s FIFA World Cup tournament being played in Canada, the U.S. and Mexico this summer — anticipated to bring economic windfalls from international fans — as a looming pressure point that could spur governments and stakeholders to find quick solutions to the fuel shortages.

“Lots of Europeans, lots of Asians are looking to come to Canada, to North America, and it’s not far away,” he said. “So there’s a significant economic overhang associated with air travel this summer, and I think we’re going to have to have some pretty interesting conversations with the governments and with the individuals in the Strait of Hormuz to get that jet fuel moving again.”

—With files from The Associated Press and the Canadian Press