Kerosene: How the Gulf War is changing airfares
For a long time, airlines were able to increase their prices significantly. But exclusive data shows: Tickets are becoming cheaper again in Germany.
Düsseldorf Airport: A plane is refueled with kerosene. Photo: imago images/Jochen Tack
In Germany, ticket prices are falling significantly again after years of price increases
Data from the British service provider OAG shows that prices for economy flights in Germany are now almost at the same level as last year. Airlines suffer from higher fuel and personnel costs, which can no longer be offset by price increases
Before the Iran war, prices in Germany rose twice as much as the European average, especially on long-distance routes to Africa and Asia. Since the war, prices have normalized as suppliers from the Persian Gulf begin traffic and demand shifts
The flight business in Germany is shrinking while it is growing across Europe. Airlines like Lufthansa are canceling flights to reduce supply and stabilize prices. Experts expect prices to rise again soon due to high kerosene costs
The summary was created and editorially checked using AI.
When the Federal Association of the German Aviation Industry celebrated the Aviation Evening in Berlin, everything was ostensibly as usual. At first, association representatives such as the head of Düsseldorf Airport, Lars Redeligx, complained about the many government burdens. Federal Transport Minister Steffen Bilger then promised that the government would “strengthen Germany as an aviation location”. And then everyone celebrated with beer from the Munich Airport brewery and treated themselves to ice cream made with liquid nitrogen from German air traffic control.
However, the atmosphere was not as relaxed and happy as usual at this event. Many guests seemed more thoughtful than usual, at least when they had completed the first round of the buffet. “After a moderate to good start and an interim high, we are now threatened with a really bad year in 2026,” said an airline board member. “And the next one probably won’t be any better,” adds a colleague.
This assessment is now confirmed by an overview from the British data service provider OAG. The company is the only one in the market that has access to airline-internal data about the flights actually carried out and the prices actually paid.
The data shows that economy class passengers in Germany have now fallen significantly again after record-breaking price jumps in the spring and late summer. This week, for the first time since the beginning of the year, travelers paid roughly the same as at the same time last year: at an average of $1,210, the price was only 1.2 percent higher than in October 2025.
This ends a phase of strong price increases. Even before the start of the Iran war at the end of February, the increase compared to the previous year was almost twelve percent, and at the end of March it was even 25 percent. The picture has now changed: prices for trips to destinations in Europe only rise in line with the inflation rate; on average, they are now well below the European average again.
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Because of the high costs, smaller airports are left behind by hubs. The economy is sounding the alarm. Entrepreneurs are now initiating their own airlines - but they are having a hard time.
What is good for customers puts a strain on the airlines. Because their costs are significantly higher today than they were a year ago. They can no longer compensate for these additional expenses due to the currently significantly more expensive aviation fuel or increased personnel costs.
This ends a long phase in which the airlines succeeded in doing exactly that. For almost four years, and especially since the start of the Iran war at the end of February, the airlines managed to raise their prices even though they were simultaneously expanding their offerings. Normally it's different, says OAG chief analyst John Grant. “Only when airlines cut capacity do prices rise,” said the expert. They usually only get rid of increasing supply with discounts.
“The global megatrend in consumption towards more premium has now also arrived in the flight business,” said Lufthansa boss Carsten Spohr at the end of September. This has continued to apply since missiles and drones hit both sides of the Persian Gulf. What Lufthansa in particular “can achieve in the market is practically unaffected by geopolitical risks and wars, which in our industry actually cause people to hold back on traveling,” says Spohr.
What this means in detail will only become clear in November, when Lufthansa presents the figures for the summer quarter. But the development is “no worse than the industry trend,” the company says. And according to OAG, that would mean: Although airlines around the world were offering more capacity until the end of March than a year earlier, ticket prices in economy class rose like never before.
In the weeks before Easter, the airlines received on average a third more seats for the so-called “wooden class” seats than in 2025. From August onwards, the increase even reached double digits again, before decreasing again in October.
Whether this is a brief adjustment or a fundamental change? Linus Bauer suspects the latter. The aviation expert from the consulting firm BAA & Partners even speaks of a “regime change”: Until April, the airlines had based their prices on demand, but since the summer they have now based their prices on costs.
Price developments on global long-distance routes are returning to normal
However, the OAG study shows that in Germany this development was somewhat different and, particularly recently, less good for the airlines.
For WirtschaftsWoche, the data service provider focused on the five largest target regions and three crucial weeks: the week before the start of the Iran war, the week of greatest inflation at the end of March and the current seven days.
The figures show that the airlines were able to increase their prices in Germany year-on-year before the crisis by 11.6 percent, twice as much as the European average. This was mainly due to long-distance routes to less large regions such as Africa, China and Japan or Latin America, where prices had already risen by well over ten percent. In the major target areas of Europe and North America, prices fell significantly in some cases.
That changed with the start of the war. Because the airlines from the Persian Gulf, such as Emirates from Dubai, more or less ceased operations, the remaining airlines benefited. They got rid of their tickets to Asia at record prices. And those who could no longer go on holiday in Asia booked holidays in Europe. Only in the direction of the USA did more passengers not want to book, which is why the prices remained the same here.
That's over now. Since Emirates and Co. have had up to 90 percent of their fleet in the air again, prices to the Far East have risen significantly less than in the spring. To destinations in South Asia such as India or the islands in the Indian Ocean, prices fall after adjusting for inflation.
Normalization is taking place in surprising ways.
Why trips to Europe and North America remain comparatively cheap
The OAG figures show: Before the Iran crisis, flight tickets in Germany - apart from trips to Europe - were on average significantly more expensive than a year before. But anyone who wanted to travel from Germany to neighboring countries, North America or the Far East paid on average between five and 17 percent less than in other European countries.
Flights to almost all parts of the world are now more expensive for passengers from Germany than for passengers from the rest of Europe. Tickets in this country only cost less on average for the two largest travel destinations, Europe and North America.
Due to the development of traffic, it should actually be the other way around.
While almost all European countries have more passengers again, fewer people are getting on planes in Germany. Even before the Iran war, the airline business in this country shrank by an average of 0.4 percent. In Europe as a whole, however, it increased by 2.5 percent. Developments towards Southeast Asia varied particularly widely. The supply in Germany fell by a good 13 percent, while the industry in Europe grew by almost 14 percent overall.
That changed in the first months of the war. Here Germany developed almost in the same way as the rest of Europe. The only exception was US traffic, which increased in Europe primarily thanks to more travelers from Eastern Europe. Now, of course, everything is almost as it was before the crisis: Germany is shrinking, Europe is growing. According to Bauer, the dismantling has three causes, “and only one of them is voluntary,” said the consultant.
With the closure of its regional subsidiary Cityline, Lufthansa canceled 20,000 short-haul flights in the hope that the tighter supply would lead to higher prices on the remaining flights. In contrast, the low-cost airlines Easyjet, Ryanair and Wizz Air cut up to five percent of their planned flights because they were no longer worthwhile given the higher costs. And finally, supply decreases due to bankruptcy. Lufthansa's subsidiary Air Baltic was the first to do this. Volotea from Spain and Animawings from Romania followed. “I expect more cases like this,” said Bauer.
This is also why prices in Germany are likely to rise again soon. This is mainly due to kerosene prices, which are still around twice as high as a year ago. And since fuel accounts for, on average, a third of the cost of European airlines, they are already flying a tenth more expensive than a year ago, even if they have hedged their purchase price for kerosene. “All providers increasingly have to pass this on,” says Lufthansa.
This article first appeared in WirtschaftsWoche.
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