Fitch Ratings: European airlines’ recovery dampened by Russia-Ukraine conflict

The European airline sector is affected by record-high fuel prices as a result of the Russia-Ukraine conflict and subsequent restrictions, sanctions and counter-measures, Fitch Ratings says. Increased jet fuel costs, particularly for carriers with lower hedging ratios, could undermine profitability recovery, despite European carriers having higher hedging positions relative to other regions. This is exacerbated by bans to fly in and over the countries involved in the conflict, leading to traffic losses and lengthened long-haul routes. Hydrocarbon prices have been rising since the start of the war, fuelled by fears over future supply interruptions and self-restrictions on purchases of Russian