Impact on the Aviation Sector

Since Vladimir Putin sent troops into Ukraine on 24 February 2022, countries across the world have imposed a series of sanctions on Russia in an attempt to de-escalate the conflict. The effects are far reaching but, most notably, target Russia's aviation sector.

The European Union imposed a series of restrictive measures by enacting Council Regulation (EU) 2022/334. This includes a blanket ban on Russian air travel, prohibiting Russian aircraft from taking off, landing in, or flying over any EU nation. Ursula von der Leyen, head of the European Commission, said the measure shuts down 'Russian-owned, Russian-registered or Russian-controlled' aircraft. The UK has imposed its own overflight and landing ban on Russian aircraft. The Russia (Sanctions) (EU Exit) (Amendment) (No. 6) Regulations 2022 make it a criminal offence for Russian aircraft to fly over or to land in the UK, ensuring that any Russian owned or chartered planes can be detained once they enter UK airspace. In response, Russia's biggest airline, Aeroflot, said it would cancel all its flights to European destinations. Given that Russia accounted for 6% of the aviation industry in 2021, this will inevitably result in economic and practical difficulties.

But what does this all mean for UK airlines, passengers and airports?

For UK airlines, the sanctions mean that flight routes must avoid Russian airspace. Flights which ordinarily fly over Russia will have a narrower range of routing options and will have to take circuitous routes, resulting in longer flight times. Virgin Atlantic has said that avoiding Russian airspace will add up to an hour to its flights between the UK and India and Pakistan. The disruption extends further than just the airspace over Russia, as some airlines are also cautiously avoiding airspace around Ukraine, Moldova and Belarus too.Re-routing flights leads to longer shift patterns for cabin crew, planes having reduced cargo capacity and an increase in fuel consumption. The net effect is a sharp increase in operating costs for certain routes. The increase in fuel costs will particularly impact airlines. One of the consequences of the conflict is a spike in oil prices which have surged to a 14-year high, with crude oil rising as high as $139 per barrel. Given that fuel makes up 30% to 40% of operating costs, the impact on airlines will be undeniable.

Passengers 

The impact on UK airlines will undoubtably affect passengers. Airlines are under pressure to pass on increased costs to passengers through higher ticket prices, which are predicted to soar. Quantas' chief executive, Alan Joyce, predicts that average fares will increase by 7% and Loganair have added a £3.95 surcharge per one-way ticket in response to rising oil prices.In addition, re-routing and longer flights will cause inconvenience for passengers with an increased risk of flights being cancelled completely, sometimes at short notice.There are signs of a dent in passenger confidence as some are choosing not to fly at all. New data shows that there has been an immediate stall in flight bookings. Despite fares between the UK and Europe dropping as low as £15, bookings have fallen by about 30%, demonstrating a degree of some underling nervousness to fly in such uncertain times.

Airports 

The war is particularly unwelcome news for UK airports, who were only beginning to recover from the severe impact of the pandemic. Passenger numbers, which had fallen by about 75%, are now on the road to recovery with UK airports predicting increased passengers for 2022/2023.However, the unpredictability of the situation in Ukraine and uncertainty of how long the conflict will last poses a major problem for airports. The UK aviation industry will again need to take a deep breath and prepare itself for another unwelcome period of disruption.

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