Air Canada has halted operations on six routes, both domestically and internationally, due to soaring fuel costs driven by the ongoing conflict in the Middle East. The airline stated that the doubling of jet fuel prices since the start of the Iran crisis has made certain less profitable routes and flights economically unviable, leading to schedule adjustments and frequency reductions.
Domestically, Air Canada has suspended the Fort McMurray, Alta., to Vancouver route effective May 28 and the Yellowknife to Toronto route effective Aug. 30. Additionally, service from Salt Lake City to Toronto will be temporarily suspended starting June 30, with plans to recommence in 2027. Flights from Toronto and Montreal to New York’s John F. Kennedy International Airport will also be temporarily suspended from June 1, with operations set to resume on Oct. 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.
Moreover, the planned route from Guadalajara, Mexico, to Montreal has been suspended by Air Canada. The airline assured that affected customers will be provided with alternative travel options. The overall impact on Air Canada’s planned capacity is approximately one percent of annual available seat miles.
The announcement from Air Canada coincides with a critical fuel crisis affecting air travel amid the prolonged U.S.-Israeli conflict with Iran. The surge in fuel prices, more than doubling since the conflict’s onset, is now being passed on to consumers. This situation has prompted other airlines like WestJet to consolidate flights on lower-demand routes, reducing capacity by one percent in April and three percent in May.
Furthermore, concerns over dwindling jet fuel supplies have been raised globally, with warnings of potential flight cancellations in Europe within the next six weeks if oil supplies continue to be disrupted due to the conflict in the Middle East. Industry experts, including John Gradek from McGill University, emphasize the severity of the aviation crisis, attributing potential long-term impacts to the region’s refining capacity constraints.
Various airlines, including Air Canada, WestJet, Porter Airlines, and Air Transat, have announced measures to counter the escalating fuel costs, such as fare increases and surcharges. While Iran’s recent announcement of the complete opening of commercial vessel passage through the Strait of Hormuz following a ceasefire agreement offers some relief, challenges persist as the U.S. naval blockade on Iran remains in place until a diplomatic resolution is reached.
Oil markets responded positively to Iran’s move, with prices dropping by 10 percent, signaling improved prospects for global oil shipments.