{"text":[[{"start":12.7,"text":"Airlines have scaled back expansion plans as the Iran war disrupts the industry, sending fuel prices soaring, threatening supplies and prompting some Asian carriers to enter crisis mode. "}],[{"start":26,"text":"Before the war, airlines planned to increase capacity this April by 5.4 per cent year on year, according to aviation consultancy Cirium. This has now been cut to growth of just 0.2 per cent. "}],[{"start":42.85,"text":"Korea’s flag carrier told staff in an email on Tuesday that it would “shift to an emergency mode” and cut costs in response to soaring fuel prices. "}],[{"start":53.19,"text":"Korean Air’s vice chair Woo Kee-hong said: “We are concerned that we may not be able to achieve our business goals this year as the expected fuel price of 450 cents per gallon in April is far surpassing the 220 cents per gallon on which our business plan is based.” "}],[{"start":73.53999999999999,"text":"The airline said fuel accounts for about 30 per cent of a carrier’s costs but that it expected the proportion to more than double if oil prices remained high. “We are seeking all options to cut costs through the emergency management,” the company said in a statement. “We are keeping an eye on the fuel supply situation and reviewing the adjustment of our flight schedules.”"}],[{"start":97.82999999999998,"text":"Asiana Airlines, the country’s second-largest carrier and which is majority owned by Korean Air, will cut 14 round-trip flights on four international routes to China and Cambodia in April and May to protect profitability. "}],[{"start":114.51999999999998,"text":"Asian airlines, excluding those in China and India, have cut their schedule from expected growth of 5.8 per cent to 2.8 per cent for April, according to Cirium. "}],[{"start":127.91999999999999,"text":"Richard Evans, senior consultant at Cirium Ascend Consultancy, said that for airlines “cash preservation will be key in this environment”, adding that he expected carriers to cut their least profitable routes first and ground their least fuel-efficient aircraft in response to higher fuel prices. Delays to spending on maintenance activity were also likely, he said. "}],[{"start":150.91,"text":"Asian airlines have proved particularly vulnerable to the closure of the Strait of Hormuz given their reliance on imports of Middle Eastern oil. The war in the Gulf has disrupted supplies of about one-fifth of the world’s crude oil, and sent prices for refined products such as jet fuel and diesel skyrocketing. "}],[{"start":173.01,"text":"Jet fuel is particularly exposed to disruption because it can only be stored for about a year before it starts to degrade, depending on storage conditions."}],[{"start":184.60999999999999,"text":"Wholesale jet fuel prices have doubled since the start of the conflict and many carriers in the region — including Air India, Cathay Pacific, Thai Airways and Qantas — have already announced plans to raise fares or add surcharges to tickets to cover the higher costs. "}],[{"start":204.75,"text":"Experts warned that prices could yet rise higher. “The market is going to continue to get tighter,” said Edward Morse, a commodities strategist at Hartree Partners. "}],[{"start":215.59,"text":"Stores of jet fuel in the US last week were at around 27.5 days, the highest level in the last five years, said Morse. That meant “it’s not going into exports, it’s staying here [in the US] and that’s because users want it”. "}],[{"start":232.44,"text":"Concerns of shortages are rife in Europe where airline executives said they were monitoring fuel supplies on a daily basis. Industry executives at two of Europe’s largest airlines said they still had visibility on supplies for another four to six weeks."}],[{"start":251.12,"text":"The last known shipment of jet fuel to the UK from the Middle East is expected to arrive this week, the FT reported. The UK has sourced at least half of its jet fuel from the Middle East in recent months, after turning away from Russian supplies following Moscow’s full-scale invasion of Ukraine and amid a decline in domestic refining."}],[{"start":273.4,"text":"Although airlines in Europe were “currently claiming they are not badly hedged and can order fuel with less risk on the downside . . . it will become an issue before too long if fuel can’t get through,” said Andrew Charlton, head of Aviation Advocacy, a consultancy. "}],[{"start":291.47999999999996,"text":"The International Air Transport Association, an industry body, warned last year that Europe’s jet fuel supply “is increasingly vulnerable”, thanks to declining domestic production and an increasing reliance on imports. "}],[{"start":307.40999999999997,"text":"Trade body Airlines UK said the country’s carriers “are currently not seeing disruption to jet fuel supply” and were continuing to “engage with fuel suppliers and government to monitor the situation”."}],[{"start":320.93999999999994,"text":"In a recent survey of airport operators across Europe, including the UK, 10 per cent of respondents reported a “potentially high risk of jet fuel shortage”. "}],[{"start":332.2799999999999,"text":"Olivier Jankovec, director-general of airport trade body ACI Europe, which conducted the survey, said some 86 per cent of members “are for the moment reporting jet fuel stocks managed by suppliers in line with normal levels”, although he added that “there remains a significant degree of uncertainty in the current situation”. "}],[{"start":355.2699999999999,"text":"A former trader at a UK petroleum importer said British airports would ordinarily have around two weeks’ worth of jet fuel supply at any one time, which another industry insider said was the case at Luton airport. The airport declined to comment."}],[{"start":372.24999999999994,"text":"While there were still some supplies in other regions such as the US, these were “not going to replace what Europe and the UK will be missing” from the Middle East, said the former trader: “It’s every man for himself now.”"}],[{"start":387.18999999999994,"text":"This story has been amended since publication to refer to Woo Kee-hong as the vice chair of Korean Air rather than chief executive"}],[{"start":397.7199999999999,"text":"Additional reporting by Leslie Hook in London and Daniel Tudor and Song Jung-a in Seoul"}],[{"start":413.80999999999995,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1775181021_1679.mp3"}