AFRICAN AIRLINES SUFFER REVENUE LOSS DUE TO HIGH FUEL COSTS

By Paul Ndiho

Air transport across Africa is critical in facilitating business, international trade, and tourism. In 2022, most regional airlines were expecting their revenue to increase. Still, those hopes appear to be shrinking as airlines are halting international and domestic flights due to the high cost of fuel.

The international air transport association says the aviation industry is struggling due to the high fuel cost – and African airlines are no exception.  South African Airways HAS NOT been profitable.  The airline has lost billions of dollars in the last seven years.  The troubled air carrier announced Tuesday that it was canceling 14 flights affecting over three-thousand passengers.  The Airports Company of South Africa says it is working to rectify the fuel shortage at the Oliver Tambo International Airport in Johannesburg.  The airport receives its fuel supply via rail, and the rail system has sustained significant damage due to recent flooding — and it has just over three days of fuel left.  Several Nigerian airlines are halting domestic flights until further notice due to rising fuel costs.  A scarcity of fuel since March has caused some African airlines to cancel and delay operations.  Global jet fuel prices have soared after Russia’s invasion of Ukraine triggered a surge in the crude oil market, hitting airlines and passengers with steep increases.  Airline passengers in Nigeria pay for fares in the naira, which has weakened sharply due to devaluations.  Suppliers are paying for fuel in U.S. dollars, a scarce currency in Nigeria.   Nigeria’s aviation ministry says it is concerned about the difficulties and the spiraling airfares due to jet fuel costs.  Still, it appealed to the airlines to consider the effects of a shutdown on travelers at home and abroad.  Kenya Airways expects to see a 20 percent rise in revenue this year after being revived two years ago.  But, Uganda airlines is not profitable — and it’s heavily subsidized.   Air Tanzania has bounced back; purchasing a Boeing 787-8 Dreamliner package valued at $224 million is costly to maintain and could cost Tanzanian taxpayers millions of dollars.  Rwandair, the state-owned flagship carrier of Rwanda, operates domestic and international flights – and may be too optimistic with its financial expectations and is running on

losses.

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