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What has happened?The war in the Middle East has choked the Strait of Hormuz, cutting oil‑shipping routes. Crude prices surged to $119 a barrel in March from $72 pre‑war – a rise of $47 or roughly 65%. ACI Europe warns that unless stable supply returns within three weeks, jet‑fuel shortages will force cancellations, potentially from May. Susannah Streeter of Wealth Club notes a growing risk for leisure flights. If your flight is cancelledFor flights departing from or arriving at UK/EU airports on UK/EU carriers, passengers must receive a refund or an alternative flight. Cancellations less than two weeks before departure also trigger compensation under EU Regulation 261/2004 – up to €600 depending on distance. Airlines must provide meals, transport and accommodation while stranded. Refund or re‑routing – mandatory for covered flights.Compensation – up to €600 if notice is under two weeks.Support services – meals, hotel, transport. Package holiday travellersPackage holidays fall under the Package and Linked Travel Arrangements. The tour operator must either offer an alternative holiday of equal value or a full refund if the flight leg is cancelled. Rory Boland of Which? Travel stresses that the provider also arranges return transport. Surcharges for fuel price rises can be up to 8%; any higher charge gives the consumer a right to cancel with a full refund. Self‑arranged tripsTravelers who book flights and accommodation separately have weaker protection. While airlines must refund or re‑book the flight, hotels and other services are not automatically covered. Matt Gatenby of Travlaw advises checking travel‑insurance policies, which may cover hotel losses, though terms vary. Credit‑card protectionsPurchases over £100 made with a credit card are covered by Section 75 of the Consumer Credit Act, making the card issuer jointly liable if the airline fails to deliver. This recourse is secondary to airline refunds and does not extend to separate hotel bookings. Pre‑booking adviceExperts recommend a “belt‑and‑braces” approach: book a package holiday with a credit card, secure comprehensive travel insurance, and choose accommodation with flexible cancellation. Be aware of potential delays at European borders – the EU’s new Entry‑Exit System (EES) can cause up to three‑hour queues, jeopardising flight connections. Airline and hub considerationsLarge carriers are more likely to have fuel‑hedging contracts, insulating them from immediate price spikes. Hub airports such as Heathrow and Barcelona typically have multiple fuel supply routes (pipelines and trucks), offering greater resilience and more alternative flights in case of cancellations. Booking timingHistorically, fares rise as departure approaches, and the cheapest seats are found early in the sales cycle. However, limited summer inventory means some airlines may later discount if demand softens due to fuel‑price anxiety.

France and the United Kingdom are convening dozens of countries to advance plans for a multinational maritime force to secure the Strait of Hormuz, a critical waterway that has been closed since Iran imposed a blockade on February 28.The meeting, taking place at the Elysee presidential palace in Paris, is being chaired by French President Emmanuel Macron and British Prime Minister Keir Starmer, with around 30 to 40 countries participating in person or by video conference.The talks will focus on the Strait of Hormuz Maritime Freedom of Navigation Initiative, a defensive mission aimed at restoring free passage through the waterway once a lasting ceasefire in the US-Israel war on Iran is in place.European leaders have warned that the ongoing closure threatens consumers with higher inflation, food shortages, and flight cancellations as jet fuel supplies dwindle. Over 20,000 seafarers are trapped on board hundreds of vessels caught in the blockade.“The unconditional and immediate reopening of the strait is a global responsibility, and we need to act to get global energy and trade flowing freely again,” Starmer said, accusing Iran of “holding the world’s economy to ransom”.The initiative mirrors Europe’s earlier efforts to assemble a security force for Ukraine and carries similar conditions: deployment only when the conflict ends and security conditions allow.A French presidential official stated that allies would need “an Iranian commitment not to fire on passing ships and a US commitment not to block any ships leaving or entering the Strait of Hormuz” before any mission could proceed.Washington’s absence from the discussions is deliberate, with Macron emphasizing that the mission to provide security for shipping through the strait would be “strictly defensive” and limited to non-belligerent countries.

Air Canada announced a temporary pause on a handful of routes departing from Toronto and Montreal to New York’s John F. Kennedy airport, attributing the decision to sharply rising jet‑fuel costs. The suspension comes as airlines worldwide grapple with fuel price spikes triggered by the ongoing US‑Israel war with Iran. Although the Strait of Hormuz reopened earlier this month, easing some oil‑price pressure, jet‑fuel costs remain markedly higher than before the conflict. In a related development, Spirit Airlines has appealed to the U.S. government for emergency financing worth hundreds of millions of dollars to mitigate its own fuel‑price surge, according to industry source reports. Air Canada explained that jet‑fuel prices have doubled since the start of the Iran conflict, rendering several lower‑margin routes financially untenable. The carrier said it is implementing “schedule adjustments, including frequency reductions,” to preserve overall network viability. Effective June 1, the airline will halt one Montreal‑to‑New York flight and three Toronto‑to‑New York flights, with service slated to resume on October 25. Additional temporary suspensions include the Salt Lake City‑Toronto corridor, which will be paused from June 30 and is not expected to return until 2027, as well as a postponed launch of a Guadalajara‑to‑Montreal service. Air Canada estimates the changes will impact about 1 % of its total passenger‑carrying capacity. Affected passengers will be offered alternative travel options, with the airline continuing to operate to LaGuardia and Newark airports 34 times daily across six Canadian cities. The move mirrors broader industry pressures: British low‑cost carrier easyJet projects a pre‑tax loss of £540‑£560 million for the six‑month period ending March, while Australian airlines Qantas and Virgin Australia have announced fare hikes and reduced flight frequencies. Moreover, the International Energy Agency warned that Europe possesses only six weeks of jet‑fuel reserves, raising concerns that further supply disruptions could trigger additional flight cancellations.

Europe is projected to run out of jet fuel in about six weeks, according to the head of the International Energy Agency, raising the spectre of widespread flight cancellations.Fatih Birol told the Associated Press that without a rapid restoration of oil shipments from the Middle East, airlines could soon be forced to drop routes, warning that “some flights from city A to city B might be cancelled as a result of lack of jet fuel.”The shortage stems from the US‑Israel war on Iran, which has snarled global energy markets since the initial strikes in late February. In retaliation, Iran has effectively sealed the Strait of Hormuz, a critical artery for Gulf oil exports.Although a two‑week ceasefire was recently brokered, negotiations to end the hostilities have stalled, leaving the supply disruption unresolved.Meanwhile, Brent crude futures are trading more than 30% above pre‑war levels, intensifying pressure on fuel prices and adding to political scrutiny in the United States.Jet‑fuel shipments that departed before the conflict have largely arrived in Europe, but the remaining reserves are rapidly being drawn down, leaving the continent vulnerable.Airports Council International Europe has warned EU energy and transport commissioners that the region could face fuel shortages within three weeks, echoing industry norms that typically maintain about six weeks of fuel on hand.Birol warned that the situation represents a “dire strait” with serious ramifications for the global economy, noting that prolonged disruption would exacerbate inflation and dampen growth worldwide.The anticipated fallout includes higher petrol, gas and electricity prices, with the impact expected to be uneven across different regions.Airlines are already scrapping marginally profitable routes, especially those without robust hedging strategies, and even carriers with hedged fuel costs may need to reconsider schedules.Despite the broader concerns, British low‑cost carrier easyJet asserted it has sufficient fuel visibility through mid‑May and does not anticipate supply‑related issues in the near term.

The UK has been identified as the most vulnerable country in Europe to potential jet fuel shortages as the Iran war disrupts supplies from the Gulf, according to Ryanair CEO Michael O'Leary. O'Leary stated that Britain's reliance on Kuwait for approximately 25% of its jet fuel supply makes it particularly exposed to shortages. He emphasized that even if there is a surplus of jet fuel in the Middle East, the logistics of shipping it to Europe remain uncertain.Jet fuel prices have surged, averaging $195 a barrel last week, more than double the average from the previous year. This increase is largely attributed to the effective closure of the Strait of Hormuz, a critical passage through which over a fifth of the world's oil normally passes.While oil prices eased slightly after US President Donald Trump expressed hope for an end to the Iran war within two to three weeks, the situation remains precarious for airlines. Ryanair has hedged 80% of its fuel costs until next March at $67 a barrel, but O'Leary highlighted that supply disruptions, rather than prices, pose the greater risk.The airline industry faces potential flight cancellations and capacity reductions if fuel supply issues persist. O'Leary also mentioned that higher fares could be a possibility, although there are currently no plans to increase prices. Additionally, he called for the UK government to abolish air passenger duty (APD), a tax that recently increased, further impacting the competitiveness of UK air travel.

The economic fallout of the US and Israel's war with Iran is being felt across the globe, with Gulf economies suffering some of the worst damage. Iran has launched continuous attacks on Gulf states since the onset of the conflict on February 28, arguing that it is targeting military bases used by the US for the war.Gulf nations have rejected Tehran's claims, insisting the attacks on them are unjustified. The Iranian strikes have upended energy production and inflicted major disruptions to tourism and travel, putting the region at risk of some of the most severe economic harm since the 1990-1991 Gulf War.According to Khaled Almezaini, an associate professor of politics and international relations at Zayed University in Dubai, the region is likely losing hundreds of millions of dollars per day in economic activity due to disruptions to aviation, tourism, shipping routes, and energy exports.Middle Eastern oil producers' daily output declined from 21 million barrels to 14 million barrels after a little more than a week of conflict, according to Rystad Energy. Output is expected to drop substantially further if commercial shipping continues to avoid the Strait of Hormuz due to Tehran's threats.Goldman Sachs estimated that Qatar and Kuwait could see their GDPs plunge 14% if the war lasts until the end of April, with the UAE and Saudi Arabia facing contractions of 5% and 3%, respectively. Meanwhile, S&P; Global Ratings has affirmed a 'stable outlook' for Qatar, citing the country's large financial buffers.The war has also spilled over into other critical sectors, particularly tourism and travel, which accounts for about 11% of the GCC's GDP. Airspace closures and restrictions led to 37,000 flight cancellations from February 28 to March 8 alone.In an analysis published last week, the World Travel & Tourism Council estimated that the conflict was costing the region $600m in daily spending by international visitors. The economic fallout could be comparable to historic regional crises if the war drags on.