Chairman Pakistan International Airlines (PIA) Consortium Arif Habib on Sunday sounded the alarm over the sustainability of the national flag carrier’s operations in the wake of a recent 150 per cent hike in jet fuel rates.
“PIA could be forced to shut down” if jet fuel prices continue to remain high, Habib warned in an interview clip shared by Bol News.
Jet fuel (JP-1) rates have been increased without a formal announcement in recent weeks amid global supply chain uncertainty spurred by the US-Iran war.
Official rates seen by Dawn suggest JP-1 prices were raised by Rs84 per litre, or 21.65pc, to Rs472 from Rs388 per litre with effect from March 21. Since March 1, the price has surged by nearly 150pc from Rs190 per litre.
Habib said the national flag carrier had “somehow” made it through the month but moving forward the ‘unsustainable’ hike would “make it difficult for PIA to operate”
He stressed that if the government does not take back its decision, he believed PIA would “not be able to continue its operations”.
“It will be forced to close,” he added.
According to aviation experts, fuel accounts for 30-40pc of airline operating expenses. The significant increase in fuel prices due to the war has forced airlines to raise fares by 20-30pc.
Domestic ticket prices have increased by Rs10,000-15,000, while international fares have spiked by Rs30,000-40,000. Further increases are likely if global oil prices continue to rise.
As of March 25, around 325 flights of Pakistani airlines — including about 200 operated by PIA — have been cancelled since the start of the war in the Middle East.
PIA continues to operate flights to Fujairah and Al-Ain, while services to Kuwait, Qatar, Dubai and Bahrain remain suspended. Flights to Saudi Arabia are operating as scheduled.
