Air Canada has halted operations on six routes, both domestic and cross-border, due to the surge in fuel costs driven by the ongoing conflict in the Middle East.
The airline stated that jet fuel prices have doubled since the beginning of the Iran crisis, impacting the profitability of certain routes and flights that are no longer economically viable. In response, Air Canada is making schedule adjustments, including frequency reductions.
Effective May 28, the service between Fort McMurray, Alta., and Vancouver is suspended domestically, while the route from Yellowknife to Toronto will be suspended starting August 30. Additionally, the service from Salt Lake City to Toronto will be temporarily suspended from June 30 with plans to resume in 2027.
Starting June 1, flights from Toronto and Montreal to New York’s John F. Kennedy International Airport will be temporarily suspended until October 25. However, Air Canada will continue to operate 34 daily flights between Canada and LaGuardia Airport in New York and Newark Liberty International Airport in New Jersey.
Furthermore, the planned route from Guadalajara, Mexico, to Montreal has been put on hold by Air Canada. The affected customers will be provided with alternative travel options, and the total impact on the airline’s planned capacity amounts to approximately one percent of annual available seat miles.
The announcement by Air Canada comes amidst an unprecedented fuel crisis in the air travel industry. With fuel prices more than doubling and costs being passed on to consumers due to the prolonged U.S.-Israeli conflict with Iran, airlines are making strategic adjustments. WestJet, for instance, has announced flight consolidations on low-demand routes, reducing capacity by one percent in April and three percent in May.
European countries are also facing a looming fuel shortage, with the head of the International Energy Agency warning of possible flight disruptions within six weeks if oil supplies remain blocked due to the conflict in the Middle East.
In response to the escalating fuel prices, Air Canada, WestJet, Porter Airlines, and Air Transat have all announced plans to increase fares or add surcharges to mitigate the impact of rising fuel costs on their operations.
Following a 10-day ceasefire agreement between Israel and Lebanon, Iran’s foreign affairs minister declared the complete opening of passage for all commercial vessels through the Strait of Hormuz. However, U.S. President Donald Trump affirmed that the U.S. naval blockade on Iran would persist until a deal is reached with Tehran.
Oil prices experienced a 10 percent drop after Iran’s announcement, signaling a potential resumption of oil tanker movements through the Persian Gulf to global customers.