U.K. government plans to allow airlines to consolidate flights as jet fuel costs soar

The U.K. government said on Sunday it plans to temporarily allow airlines to consolidate passengers onto fewer planes over the summer holiday season, a move aimed at preventing last-minute flight cancellations as jet fuel costs remain elevated amid uncertainties over the Iran war.

The plan would also allow carriers to give back some of their take-off and landing slots without losing them the following season, the U.K. said.

"These temporary measures would allow airlines to, for example, consolidate schedules on routes where there are multiple flights to the same destination on the same day," the government said in a statement.

The loss of Middle Eastern jet fuel because of the Iran war is quickly becoming an acute logistics problem for Europe, according to analysts at Societe Generale.

Jet fuel prices have surged since the critical Strait of Hormuz was blockaded after the war in the Middle East began on Feb. 28.

The average price of jet fuel surged to $179 per barrel for the week ending April 24, according to the International Air Travel Association's Jet Fuel Price Monitor, far higher than the average before the war.

Speaking to CNBC on Thursday, Ryanair CEO Michael O'Leary said that his airline was protected because it had hedged 80% of its fuel but predicted "real failures" for other airlines if the price of jet fuel did not fall.

U.S. budget carrier Spirit Airlines shut down on Saturday after failing to secure an agreement with bondholders on an 11th-hour bailout from the Trump administration. Soaring costs, including for fuel, added to a list of problems the airline faced for years as it struggled to stay aloft.

"The contingency preparations are designed to give families greater confidence when travelling this summer by enabling airlines to plan realistically and lock in schedules earlier so that people are less likely to be affected by short‑notice changes at the airport," the U.K. government said.

Airlines would be allowed to move passengers onto "similar services much earlier, helping avoid stressful delays at the airport," the government said.

The plan would also prevent carriers running flights which have not sold a "significant proportion of tickets" and "reduce wasted fuel from flying near-empty planes".

"Since the closure of the Strait of Hormuz, the government has been monitoring jet fuel supplies daily and working with airlines, airports and fuel suppliers to stay ahead of any problems," U.K. Transport Secretary Heidi Alexander said, adding that "there are no immediate supply issues".

The head of the trade body for U.K.-registered airlines welcomed the proposal.

"U.K. airlines continue to operate normally and are not experiencing issues with jet fuel supply," Tim Alderslade, CEO of Airlines UK was quoted as saying in the statement.