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Chinese airlines are expanding abroad as foreign airlines shift away from China due to low demand, rising costs, and longer flight times, Reuters reported on Friday. Flight times have lengthened for international airlines on the back of European and US carriers avoiding Russian airspace, the newswire writes. Chinese carriers have up to 30% lower costs than their international rivals due to taking shorter northern routes to Europe and North America over Russia’s vast airspace.
A slew of flight suspensions coming in October: British Airways announced it would pause its London to Beijing flights for one year starting late October, and suspended one of its daily flights to Hong Kong last month for commercial reasons. Virgin Atlantic is cutting its London to Shanghai route permanently effective October, citing longer flight times. Royal Brunei Airlines will also be suspending its Beijing flights due to market conditions effective October. Qantas Airlines suspended its Sydney to Shanghai flights in July due to low demand for China travel and half-empty planes.
Brazilian plane manufacturer Embraer’s bottomline spiked by almost 40% to USD 80.4 mn in 2Q, following boosted delivery rates for commercial aircraft, Reuters reported on Thursday. The firm’s topline rose some 15.6% y-o-y to USD 1.49 bn, supporting its forecasted 2024 outlook, which expects to deliver around 72 commercial aircrafts and generate an annual topline of around USD 6 bn. The manufacturer boosted aircraft deliveries by 12% y-o-y to 19 jets in 2Q.
Expanding its regional influence? Senior executives at Embraer met with Saudi Industry and Mineral Resources Minister Bandar Al Khorayef in July to discuss the localization of aircraft manufacturing and assembly in the Kingdom. Embraer and commercial aviation lessor Azorra will supply eight aircraft to Royal Jordanian for USD 635 mn. The Jordanian airline will acquire four E190-E2 — which can seat 92 passengers — and four E195-E2 jets, which can seat 120. This added to Royal Jordanian Air’s outstanding order for one to three additional E195-E2 regional jets from Embraer to be delivered next year.
Oil demand could jump up by hundreds of mns of barrels if Donald Trump wins the US presidential elections this November, as the nominee has pledged to fill the US Strategic Petroleum Reserve (SPR) if elected, the Financial Times reported on Thursday. “We don’t need energy from any other country. We have to fill up the strategic reserves again. It is the lowest number it has ever been,” the former president said. As of last month, the SPR, the world’s biggest supply of emergency crude oil, held 375 mn barrels of oil, which is a little over half of its capacity. The US would need to purchase around 300 mn barrels of oil to reach the levels seen during Trump’s last presidency.
US and China have been moving to purchase oil amid a drop in prices: “We are seeing more plans to replenish strategic crude oil inventories, which we anticipate will contribute to healthy oil demand over the next few months,” said Saudi Arabia’s Aramco chief executive Amin Nasser.
OTHER STORIES WORTH KNOWING THIS MORNING-
- Panama Canal eases limits on vessel draft size: The Panama Canal Authority has raised the maximum authorized draft of vessels to 49 ft for transits through the Neopanamax Locks, effective immediately. (Statement)
- China’s imports exceeded market forecasts in July: China’s USD-denominated global imports grew by 7.2% y-o-y in July, surpassing expectations of 3.5%. Imports rose 24% y-o-y from the US, 11% from the Associations of Southeast Asian Nations, and 7% from the EU. China’s exports increased by 9.7% y-o-y in July amid an upturn in global trade, up from 8.6% in June and rising for a fourth consecutive month. (CNBC)
