Consortium Chief Urges Government to Reverse Aviation Fuel Hike
Karachi: Chairman of the Pakistan International Airlines consortium, Arif Habib, warned on Sunday that the airline could face closure if rising jet fuel prices persist. Speaking in a televised interview, he cautioned that the recent increase in aviation fuel costs has made operations increasingly unsustainable.
Jet fuel (JP-1) prices have risen sharply in recent weeks without a formal announcement, amid global supply disruptions linked to the US-Iran conflict. Official data indicates that prices jumped by Rs84 per litre to Rs472 from Rs388 on March 21. Moreover, since March 1, rates have surged nearly 150 percent from Rs190 per litre.
Habib argued that the government increased aviation fuel prices to offset subsidies provided to consumers. He explained that authorities appear to be using cross-subsidisation and savings from austerity measures to manage the fiscal burden of rising oil costs.
Rising Costs Push Airfares Higher, Threaten Industry Stability
Meanwhile, Muhammad Aurangzeb recently stated that the government allocated Rs69 billion from its own resources to provide targeted relief. However, Habib described the current approach as unsustainable and urged policymakers to reconsider the pricing strategy.
He emphasized that aviation fuel costs directly affect the broader public, rejecting the notion that air travel does not impact ordinary citizens. Furthermore, he warned that continued price hikes could make it impossible for PIA to maintain operations.
Aviation experts noted that fuel constitutes 30 to 40 percent of airline expenses. Consequently, airlines have already increased fares significantly. Domestic ticket prices have risen by Rs10,000 to Rs15,000, while international fares have climbed by Rs30,000 to Rs40,000.
Additionally, analysts cautioned that further increases may occur if global oil prices continue to rise, potentially undermining Pakistan’s aviation competitiveness in international markets.
