Crisis in Aviation Industry: High Fuel Prices Drive Up Transportation Costs

The Financial Times reports that the war in the Middle East has caused a sharp decline in the shares of the world's largest airlines. Their market capitalization has been wiped out by $53 billion.

Low-cost carriers have been particularly hard hit: these carriers earn little per passenger and are finding it difficult to offset losses due to high fuel prices.

Management of all airlines points to a sharp increase in transportation costs. In this situation, it is impossible to avoid increasing ticket prices. But even this will not save many. Lufthansa intends to ask the government for assistance; without budget support, Germany's largest airline will simply go bankrupt.