A drop in oil prices is likely to lead to lower airfares starting next year, Saif Mohammad Al Suwaidi, Director General of the General Civil Aviation Authority, said in Abu Dhabi on Monday.
“It will be a positive effect starting from next year. We will see a drop in ticket prices,” he told reporters at a conference. He, however, did not say to what extent airfares are likely to go down.
According to Al Suwaidi, the tourism sector will pick up due to cheaper airfares. “It will be good for the airline sector. We are expecting a passenger growth of 10-12 per cent next year,” he said, adding that it has been a good year for the aviation industry, both in terms of finances and operational capacity. “There has been an increase in the number of flights. The growth has not stopped nor slowed down.”
Brian Pearce, chief economist at International Air Transport Association (IATA), too, said last week that the weakening oil prices are expected to result in lower airfares next year.
Oil prices have been going down since June due to weak demand and oversupply benefiting the airline industry in procuring cheaper jet fuel.
Asked whether the UAE is considering resumption of flights to Syria, Yemen, Libya and Iraq, Al Suwaidi said that they don’t have any such plans but added that they would keep monitoring the situation and would take a decision at an appropriate time. He ruled out starting of flights to Syria but said they would consider Yemen depending on the improvement of the situation.
Al Suwaidi further said that there are no air safety concerns with the operators working within the UAE airspace. “We always monitor operators and ban those not complying with our safety standards,” he said.
