Branson links higher airfares to war in Iran
Virgin Group founder Richard Branson linked the increase in air ticket prices to the war in Iran, which he called unnecessary. As MyJoyOnline reports, citing the BBC, the businessman criticized “foolish leaders” who start wars, referring to the conflict involving the United States and Israel against Iran.
According to Branson, the agreement on Iran’s nuclear program, which was negotiated during Barack Obama’s presidency and with the participation of many Europeans, was working. In his view, there was no need to cancel it, while the war led to a significant rise in global oil prices and became one of the factors driving inflation.
Jet fuel prices
Tensions in the Middle East have restricted the production and transportation of millions of barrels of oil, causing prices for motor fuel and jet fuel to rise. Before the war, the European benchmark price for jet fuel stood at about $800 per tonne, then exceeded $1,800 in April. It later fell to around $1,450 per tonne.
In May, Virgin Atlantic introduced a fuel surcharge: £50 for economy class, £180 for premium class, and £360 for business class. The airline’s chief executive, Corneel Koster, said that additional charges were necessary at such fuel price levels.
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Airlines’ decisions
Some of Virgin Atlantic’s competitors, after the conflict began, not only raised fares but also reduced the number of flights. According to an assessment by consultancy firm Teneo published in April, the war in Iran caused airfares to rise by 25%.
Ryanair said this week that it was cutting its winter schedule because of more expensive fuel and warned that European fares on short-haul routes would rise significantly if jet fuel prices continue increasing until next summer. Virgin Atlantic does not plan major changes to its winter program and expects to operate 95% of its usual schedule.
Branson made the statements while announcing Virgin Atlantic’s contract to transport Team GB and ParalympicsGB to the 2028 Summer Olympic Games in Los Angeles. British Airways had previously held this contract since the 2008 Olympics in Beijing.
