Thursday, 23 June 2022 15:05

In the short or long term, airline tickets are going to go up

Written by Evelyn Alas

If you are thinking of taking a trip in a few days either for your vacation or a business trip, you better prepare your wallet because airline ticket prices could face possible hikes in the short and long term.

According to the International Air Transport Association (IATA), airline tickets have risen in price due to inflation after two years down due to the pandemic, a trend that could be accentuated in the long term due to environmental regulations.

This sector went through two years of crisis with planes flying half-empty and prices relatively low compared to the pre-Covid-19 level. But with the lifting of most restrictions, bidding time is over.

In the United States, the average price of a domestic route went from US$202 in october 2021 to US$336 six months later, according to statistics from the Saint Louis Federal Reserve.

In the European Union, the untaxed price of banknotes returned in april to the level it was at in the same month of 2019, following a drop of more than 20% in 2020, according to data from consultancy Cirium.

The causes of the rise are a strengthening of demand, a supply girded by logistical difficulties and inflation unprecedented in 40 years due to the impact of the war in Ukraine on oil prices.

Airlines project that fuel will account for 24% of their costs this year, compared to 19% in 2021.

Some governments have already made it mandatory to use part of the energy from these fuels, forcing airlines to impose cost overruns on consumers.

IATA estimates the total cost of the transition to zero emissions at US$1.55 trillion over 30 years.