Cathay Group is cutting capacity from mid-May to end-June as a result of fuel cost increases amid the ongoing conflict in the Middle East.
The airline group said cutting capacity has “always been our last resort”, but will now need to consolidate a “small number of passenger flights”.
“We have pursued every suitable means to keep our flights operating as normal, including the adjustment of fuel surcharges," said Cathay Group chief customer and commercial officer Lavinia. "However, these measures have not been enough to mitigate the significantly increased fuel costs.”
This will impact around 2% of Cathay Pacific's total frequencies and around 6% of its low-cost subsidiary HK Express' total frequencies for the period.
The airline group said it aims to operate all of its scheduled passenger flights after June, depending upon the outcome of the Middle East conflict and jet fuel prices.
With the war stretching further than anticipated — first breaking out after US and Israel attacks on Iran in late February — crude oil prices have peaked at above $100 per barrel and have remained volatile. The sustained high oil prices has put pressure on airlines globally.
The International Air Transport Association (IATA) reported that global average jet fuel price had soared to $197.83 per barrel for the week ending April 10 2026, more than doubling from the $99.40 per barrel the week ending February 27 — a day prior to the conflict began.
Only yesterday, Lufthansa announced it was accelerating its corporate strategy to meet the growing cost pressures. This included closing its Lufthansa CityLine airline, removing 27 costly aircraft from its fleet.
Cathay's update came as the group reported its monthly traffic figures for March.
Cathay Pacific carried 24% more passengers in the month, compared to March 2025, reaching 2.8 million, while capacity was up 9.3%. Passenger load factor was up 9.5 percentage points to 92.2% in the month.
Revenue passenger kilometres was up 21.9% during the month.
Lau said Cathay experienced “robust” demand for its premium cabins in March. Later in the month, leisure travel demand for short-haul markets saw increased demand.
The airline extended the suspension of its passenger flights to Dubai and Riyadh until June 30, 2026.
“We have also mounted additional flights and capacity to Europe in March and April to cater for an upsurge in market demand as passengers prioritised alternative routings,” said Lau.
Passenger demand is expected to remain robust through April. This is supported by the Easter holidays and increased bookings on long-haul routes with more transit traffic going through its home hub at Hong Kong International Airport.
HK Express carried 750,668 passengers in March 2026, up 21.8%, while capacity was up 12.2%. As a result, load factor was up 5.4 percentage point 84.4%.
Cathay's cargo division carried 11% more cargo in the month, while freight tonne capacity was up 1.8%. Cargo load factor was up 1.5 percentage points to 62.9%.
Earlier this week, Cathay Pacific proposed a capital reduction of HK$6.97bn ($890.3 million). This aims to offset the reduction in distributable reserves, following its buyback of 643 million shares from Qatar Airways Group completed in February 2026.