Mehran Haghirian
Al-Monitor
September 2, 2024
The escalating tensions in the Middle East and particularly the tit-for-tat exchanges between Israel and Iran have damaged the global aviation and logistics sectors, disrupting far more than just the immediate conflict zones. The economic consequences are becoming increasingly severe, with national finances and industries dependent on global transportation bearing the brunt of these geopolitical clashes.
Military action and even the mere anticipation of conflict often trigger widespread disruptions in airspace management, affecting commercial and cargo flights across the globe. In April, Israel’s strike on the Iranian Consulate in Damascus and the anticipation of Iran’s retaliation set off a wave of flight rerouting that lasted over two weeks, subsiding only after hundreds of drones and missiles flew over Iran, Iraq, Jordan and Israel on April 14. This episode highlighted how localized conflicts can precipitate economic losses affecting the Middle East, Europe, Asia and the United States. Key regional players — Iran, Jordan, Iraq, Lebanon and Israel — responded by closing their airspaces.
The assassination of Ismail Haniyeh in Tehran on July 30 triggered more aviation chaos, causing disruption across the region again. Airlines that usually fly over these countries were forced to reroute flights toward Kazakhstan, Tajikistan, Saudi Arabia and Egypt. For global carriers, such disruptions cascade across networks, causing delays that ripple through interconnected hubs and distant connections. A single rerouted flight from Brussels to Doha, for instance, can upset schedules from Bangkok to New York, illustrating the delicate balance in global aviation logistics.
For passengers, the fallout is palpable. Lengthier flights, unexpected fare hikes and limited availability have become increasingly common as they navigate a web of travel advisories and airspace closures. In April, multiple countries — including Canada, France, India, the United States and several European nations — issued travel warnings for the Middle East. Canada reiterated these warnings in August, advising citizens to avoid all travel to Lebanon, Israel, Iran and Iraq. Beyond the economic costs, uncertainty and anxiety for millions of travelers, especially those with familial connections in conflict zones, add a human dimension to the geopolitical tensions.
Loss of crucial air corridors
The strategic air corridors over Iran and Iraq are indispensable to global aviation. European carriers such as Lufthansa, KLM and Swiss Air as well as American airlines such as United and Delta depend on these airspaces as vital links to Asian markets. For Gulf-based airlines such as Emirates, Etihad, Fly Dubai and Qatar Airways, these airspaces are crucial for routes connecting to Central Asia, Europe and North America. Qatar Airways navigated tough challenges during the more than three and a half years of blockade on Doha. Between June 2017 and January 2021, Qatar reportedly paid Iran around $133 million a year as its airspace is the only one available for Qatar's planes, according to a Fox news report from July 2020.
In the 2010s, roughly 1,200 flights passed through Iranian airspace daily, generating nearly $800 million annually in overflight fees — a crucial revenue stream for Tehran as it reels from the impact of economic sanctions. Iran’s fees for planes transiting through its territory were significantly higher than those charged by neighboring countries. Using Iran’s fee calculation formula, an Airbus A380 flying from London to Dubai and covering roughly 1,500 kilometers (932 miles) through Iranian airspace would incur a fee of around $3,594. A Boeing 737 on the same route would cost around $426.
The tragic downing of Ukraine Airlines Flight PS752 in January 2020 in the midst of Iran-US tensions heavily reduced traffic over Iran. The US Federal Aviation Administration temporarily banned US carriers from operating in the airspace over Iraq, Iran and the Gulf following a similar call to temporarily ban flights in the same locations during high tensions in the summer of 2019. Russia issued a similar statement. These developments, combined with the COVID-19 pandemic, slashed air traffic over Iran by more than 85% by March 2020, causing the country's income to fall by more than $300 million. In response, Iran offered steep discounts — up to 50% — on overflight fees to lure back international carriers.
In contrast, Iraq has increased its fixed fees to $450 per flight from the previous range of $60 to $105 per flight, depending on aircraft size. But it still earns only around $150 million annually, far short of its potential $500 million, according to a report by the Iraq-Britain Business Council from June 2023. The gap is due to persistent challenges including airspace congestion, outdated paper-based air traffic control systems, language barriers, security risks and poorly managed airport operations. Also, the US Department of Transportation, for instance, fined Emirates $1.5 million for codeshare flights — which two airlines operate together — with JetBlue Airways over prohibited Iraqi airspace, prompting Emirates to cease US-linked operations through Iraq. Emirates faced similar sanctions in 2019 for operating JetBlue flights over Iranian airspace, receiving a $400,000 fine.
Some airlines have chosen more drastic measures. Singapore Airlines has completely halted operations through Iranian airspace, while the United Kingdom has advised its carriers to avoid Lebanese airspace until November. Major airlines like British Airways, Air India and Malaysia Airlines are rerouting flights to avoid both Iraqi and Iranian skies. Qantas, for instance, had to add a refueling stop in Singapore for its Perth-London flights. Jordan, preparing for sudden airspace closures, now mandates that airlines landing at its airports carry an additional 45 minutes of reserve fuel. Compounding these challenges are operational risks like GPS jamming and military activities, which further strain already complex flight operations.
European and Asian carriers are also grappling with these disruptions. Air France and Transavia only recently resumed flights to Beirut after suspending operations from July 29 to Aug. 15. Lufthansa Group carriers — Austrian Airlines, Brussels Airlines and Swiss International Air Lines — have halted flights to key destinations such as Beirut, Erbil, Tehran and Tel Aviv. Air India, United Airlines, American Airlines and Delta have suspended routes to Tel Aviv indefinitely, with Cathay Pacific extending its suspension through March 2025. Austrian Airlines has postponed flights to Tehran until at least April 2025.
Europe feeling impact
These recurring Middle Eastern conflicts have added to the strain the ongoing war in Ukraine has already placed on global aviation. European airspace remains severely restricted, with 36 countries — including European Union member states, the United Kingdom and the United States — banning Russian airlines from their airspace. Russia retaliated by prohibiting airlines from these nations from flying over its territory. The International Air Transport Association reports that the Ukrainian airspace closure alone halted 3.3% of Europe’s total air passenger traffic and 0.8% globally.
Geopolitical risks and political tensions have turned rerouting into a costly necessity for airlines. Long-haul flights incur steep costs, with expenses for extended routes reaching $10,000 to $50,000 per flight. For instance, a Boeing 777 burns about 2,500 gallons of fuel per hour, and at $2.50 per gallon, extra fuel costs alone can skyrocket. Factors such as overtime pay and maintenance expenses as well as European regulations regarding delays add further financial strain. Environmental costs must also be factored in.
Beyond passenger travel, international trade and air freight logistics are equally affected. Rerouting has decreased freight capacity while higher fuel needs have reduced available cargo space. These issues, coupled with rising operational costs, are triggering supply chain disruptions and delivery delays. In addition, insurance premiums and security measures have surged in response to the perceived risks of flying near conflict zones.
Aviation diplomacy
The International Air Transport Association and the International Civil Aviation Organization set up coordination teams as a precautionary measure to mitigate such risks. These teams bring together airlines, regulators and air navigation service providers to manage potential threats through real-time communication. However, regional governments need to do more to prevent political tensions from spilling over into international airways. Establishing reliable hotlines and ensuring timely notifications in the event of military action are crucial to minimizing risks. Aviation diplomacy could be added to the agenda in bilateral and multilateral engagements with the aim of establishing regional airspace coordination mechanisms, which could involve managing rerouting strategies during high-risk periods and setting up joint air traffic management protocols.
The ongoing Iran-Israel tensions, coupled with broader regional instability, underscore the intricate dependencies and vulnerabilities within global transportation networks. As airlines recalibrate routes, renegotiate airspace agreements and adapt to evolving geopolitical realities, the financial and logistical challenges will continue to escalate. The stakes are high, with daily costs running into millions of dollars, leaving passengers and carriers alike high and dry.
Link to the article: https://www.al-monitor.com/originals/2024/08/turbulent-skies-how-israel-iran-tension-disrupting-global-aviation
Photo Credit: Royal Jordanian Samer Majali hopes for a quick resolution to the conflict in Israel. Henry Chow 0516 / Flickr
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