As an estimated 2 million Ukrainian refugees make their way into and across EU countries, it is clear that another travel crisis (and a bigger political one) has displaced the Covid-19 pandemic.
The International Air Transport Association had published its latest long-term forecast for air travel in 2024, stating they believed that the number of travelers would exceed 4 billion (more than pre-Covid levels).
IATA said of the pandemic that the “progressive relaxation or elimination of travel restrictions in many markets” led them to be optimistic about North Atlantic and intra-European markets although they believed that Asia-Pacific would lag in comparison because of the fact that China is “not showing any signs of relaxing its severe border measures.”
Since Russia invaded Ukraine, however, travel rules have rapidly changed across the EU–involving the closure of EU airspace, EU travel bans for specific people and a clamp down on second passport applications. Plus, the EU has granted Ukrainians the right to live and work in the EU for up to a year, renewable if necessary.
And whilst IATA said in its statement that the long-term growth of air transport would be resilient, it added that “it is too early to estimate what the near-term consequences will be for aviation” but there are likely to be lots, obviously depending on “the geographic extent, severity, and time-period for sanctions and/or airspace closures.”
Before the pandemic, Russia was the 11th largest market for air transport services (in passenger numbers) and that included its domestic market. In contrast, IATA reported that Ukraine ranked 48.
In terms of impacts, IATA reported several possible travel outcomes from the conflict–that impacts would obviously be more severe in both countries plus neighboring areas. IATA added that “the impact on airline costs as a result of fluctuations in energy prices or rerouting to avoid Russian airspace could have broader implications. Consumer confidence and economic activity are likely to be impacted even outside of Eastern Europe.”
The research team at travel app Hopper has been monitoring the impact of the Ukraine invasion on travel demand, bookings, and airfare–and how jet fuel factors into pricing.
Unsurprisingly, Since February 24th, searches for round-trip flights from the U.S. to Europe have been down an average of 9% below expected levels. This impact is not seasonal, and not seen for flights to other regions nor in the domestic U.S. market.
Additionally, airfare from the U.S. to Europe is currently $770 for a round-trip, which is a 16% increase month on month from $663 for a round-trip on February 12th. Additionally, Hopper said that “higher jet fuel prices created by the Russia-Ukraine war are likely to create additional upward pressure on all airfare.”
