Qantas sees no international restart until July 2021

Market: Oil products
20/08/20

Australia's national airline Qantas sees no restart to its international flights in the 2020-21 fiscal year to 30 June with the impact of the Covid-19 pandemic, other than the possible start-up of flights to neighbouring New Zealand where infections are at relatively low levels.

International flights from Australia typically account for the largest share of total Australian jet fuel consumption. But Qantas expects jet fuel costs to be lower in 2020-21 than the A$2.9bn ($2.08bn) in 2019-20 with the subdued international operations. The airline gave no guidance on jet fuel costs. Its 2019-20 jet fuel costs were below the A$3.85bn of 2018-19 with the Covid-19 slump in air travel.

Qantas has recognised A$571mn of de-designated hedge losses for 2019-20 with the slump in flying activity from April this year and the anticipated drop in fuel consumption in 2020-21. The fuel hedge losses contributed to a loss of A$1.96bn in 2019-20 from a profit of A$840mn. Qantas in June said it was expecting around A$6bn in jet fuel savings over the next three years because of the weakness in international travel.

By Kevin Morrison

Qantas jet fuel costs (A$bn)
2015-16	2016-17	2017-18	2018-19	2019-20

3.2	3.0	3.2	3.9	2.9
Source: Qantas

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