Air New Zealand scraps FY26 guidance on ‘unprecedented’ jet fuel prices
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The news: Air New Zealand has suspended its FY26 guidance after warning of “unprecedented volatility” in global jet fuel markets amid the escalating conflict in the Middle East.
The numbers: New Zealand’s national flag carrier said at its interim results on 26 February that, assuming an average jet fuel price of USD85 ($120) per barrel, second-half earnings would be “broadly in line with, or modestly below” the first-half loss of NZD59 million ($50 million).
The airline said this morning that conflict in the Middle East has led to “extreme volatility” in jet fuel markets, with previous jet fuel prices of USD85-90 per barrel rising to USD150-200 per barrel.
Air New Zealand said since the conflict began, the crack spread — or the difference between the benchmark crude oil price and the price of refined jet fuel — has widened from around USD22 per barrel to as high as USD115 per barrel.
The context: The company said it has implemented initial fare adjustments and warned it may need to take further pricing action and make adjustments to its network and schedule if the conflict leads to continued elevated jet fuel costs.
It is also progressing cost reduction initiatives, which are expected to partially offset those pressures.
What they said: “Due to this unprecedented volatility, the jet fuel price assumption underlying Air New Zealand’s 26 February 2026 guidance is no longer appropriate,” the company said.
“The crisis is expected to meaningfully affect second-half earnings and accordingly, the airline has suspended FY2026 guidance until fuel markets and operating conditions stabilise.”
The source: ASX
