Qatar Airways Calls Iran Conflict Its Biggest Crisis in 30 Years

wThe ongoing conflict in Iran has proven to be the biggest test for Qatar Airways in its more than 30 years in operation, while the airline has taken measures to adapt to the crisis, Chief Executive Officer Hamad Al-Khater said.

“It was our single largest crisis in our history,” Al-Khater told Bloomberg TV ahead of the Qatar Economic Forum taking place in New York on Sunday.

“But geopolitics is something we deal with on daily basis.”

The conflict, now in its seventh month of on-off exchange of fire between the US and Israel on the one side and Iran on the other, has led to major dislocation in one of the world’s most important aviation markets, which sits at the crossroads of a major flight path. Countries across the Arabian Gulf were forced to temporarily close their airspace, cancelling tens of thousands of flights. Authorities across the world issued travel warnings, contributing to a drop in tourist visits to the Middle East.

The war has affected some behaviour as consumers tend to book later than usual, the chief executive said. For many airlines, the rise in fuel costs has also forced them to take out capacity, weeding out some flights to converse cash.

“We are looking at routes and saying, what are most profitable routes? The less profitable routes we are suspending or pausing,” he said.

But demand is “still pretty strong” as travel advisories ease and load factors remain high, although the number of travellers that pass through the Middle East region remains subdued, he said.

Qatar Airways has announced a return to the same number of routes as its pre-war operations for the first time last week, and neighbouring Emirates also said it has restored nearly all its network and capacity.

Al Khater echoed comments by the chief executive of Abu Dhabi-based Etihad Airways on passing higher fuel prices on to customers, citing the airlines’ focus on capacity rather than market share.

A global oversupply of crude oil at the beginning of the year allowed Qatar to offset some of the impact from the rise in jet fuel, Al-Khater said. Still, “fuel is definitely something we are all closely monitoring,” he said.