Air France-KLM revises capacity outlook on geopolitical uncertainty
The airline expects fuel costs to rise $2.4 billion this year as Middle East disruptions push jet fuel prices higher.
- On Thursday, Air France-KLM lowered its 2026 capacity growth forecast to 2% to 4%, down from its previous projection of 3% to 5%, citing rising fuel prices caused by the Iran war.
- The airline group expects its annual fuel bill to surge by $2.4 billion this year due to energy market disruptions, with nearly $1.1 billion of those additional costs occurring in the second quarter.
- Despite the outlook downgrade, Air France-KLM reported revenues rose 4.4 percent to nearly 7.5 billion euros in the first quarter, though the group posted a net loss of 252 million euros, or $294 million.
- Chief Executive Benjamin Smith warned the group cannot fully offset these costs, yet Bernstein analyst Alex Irving noted the decision reflects "an ongoing strong earnings environment and high demand for travel."
- While travel demand remains robust, the airline plans smaller increases to long-haul capacity, as passengers increasingly postpone bookings due to concerns regarding the financial risk of long-distance trips amid the ongoing conflict.
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54 Articles
Three hours Franco-Dutch airline giant Air France-KLM (Air France) today cut its business forecast for 2026, expecting slower growth as fuel costs begin to rise due to the US war on Iran.
Company alerted to increase by $2.4 bi in the fuel account this year with the shooting of oil quotes
Air France-KLM tickets will become even more expensive due to high fuel costs resulting from the Iran war. However, the airline cannot pass on all extra kerosene costs to travelers, as the Franco-Dutch aviation group would lose too many customers.
Candidate for the purchase of TAP, the Air France/KLM group ensures that it will make an offer "as strong" as it can and away for now any impact of the conflict in the Middle East on the privatization of TAP
However, two Asian airports, Singapore and Tokyo-Haneda, asked the Franco-Dutch group not to add flights.
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