US, Israel, Tehran agree two-week ceasefire

Jet fuel supply would take months to recover even if Iran were to open the Strait of Hormuz, the head of the International Air Transport Association (IATA), Willie Walsh, said on Wednesday.

Jet fuel prices have more than doubled since the US and Israel launched their war with Iran on February 28, alongside broader energy shocks wrought by disruptions to the oil-rich Persian Gulf region.

“If it were to ​reopen and remain open, ‌I think it will still take a period of months to get back to where supply needs to be given the disruption to the refining capacity in the Middle East,” Walsh told reporters in Singapore.

“I don’t think it’s going to happen in weeks,” he said.

He stressed that oil refinement capacity is too localized to be able to be swiftly restarted.

“Even if you have the flow of crude start again, if you’ve had disruptions in refining capacity, then the problem continues for some time,” Walsh said.

“I don’t think everybody fully appreciated how concentrated the capacity was in certain parts of the world,” he added.

Gulf transport hubs to ‘recover quickly’

However, he stressed that he expected major airports in the Gulf — the site of international transit hubs such as Doha, Abu Dhabi and Dubai — to swiftly recover from reduced capacity after Iran launched strikes on countries in the region.

“I fully expect the Gulf hubs to recover and recover quickly,” he said, adding that “there’s no way” other airlines can “replace the (entire) capacity that was provided by the Gulf carriers.”

He said that he expected airlines to respond to the crisis by increasing prices, calling such a move “inevitable.”

Walsh also emphasized that the disruptions caused by the war between the US and Iran have not been comparable to those of the COVID-19 pandemic in 2020-2023.

“This is not similar to COVID. This is not a crisis anywhere close to ‌what we experienced (in COVID),” he said. “In COVID, capacity reduced by 95% because borders closed. We’re nowhere near that.”

He instead compared this year’s war between the US and Israel and Iran with the shocks that accompanied the September 11, 2001 attacks on the United States and the 2008 economic crisis.

“Post-9/11, the recovery took about four months. In 2008-2009 it was probably 10 to 12 months,” he said.