Thursday briefing: A ceasefire has changed the picture but the fuel crisis does not end today
A US-Iran ceasefire was announced yesterday. Oil fell below $100. Airline stocks surged globally. IATA's Willie Walsh says jet fuel supply will take months to recover regardless. Bahrain has reopened its airspace. EASA reviews its UAE bulletin this morning.
Good morning. The most consequential development in aviation since the Iran war began happened yesterday. A two-week ceasefire between the United States and Iran was announced on April 7, brokered by Pakistan, with Iran agreeing to allow passage through the Strait of Hormuz during the truce period. Oil fell below $100 per barrel. Airline stocks surged across every market. The crisis is not over — here is what the ceasefire actually means for the industry.
The ceasefire: what it does and does not do for aviation
IATA director general Willie Walsh warned it would take months for jet fuel supply to recover even if Iran reopened the Strait of Hormuz, given disruptions to Middle East refining capacity. That is the number that matters most for airlines, not the oil price. Crude falling below $100 is real relief for the forward curve. Jet fuel returning to pre-war levels is a separate and longer process — the refining infrastructure across the Middle East that processes crude into aviation fuel has been damaged and disrupted. Reopening the Strait moves oil. Restoring refinery output takes months.
The global average jet fuel price for the week ended April 3 rose to $209 per barrel — up 132% on an annual basis. That figure does not correct overnight because a ceasefire was announced.
Airspace: what is actually reopening
The airspace news is more immediately concrete. Bahrain announced it will reopen its airspace as the ceasefire takes effect, having closed it on February 28 following Iranian retaliatory strikes. Iraqi airspace is also reported to be reopening. These are meaningful connectivity improvements for carriers operating into the Gulf.
The EASA conflict zone bulletin covering UAE airspace — CZIB 2026-03-R5 — is under review today. That bulletin is the specific document preventing British Airways, Lufthansa, KLM and Air France from returning to Dubai; their war-risk insurers follow EASA's assessment directly. The ceasefire materially improves the chances of EASA softening or lifting the advisory. We will publish analysis as soon as the decision is available this morning.
One significant complication: Iran stopped oil tanker traffic through the Strait after Israel attacked Lebanon, with just two oil tankers crossing since the ceasefire took effect. The ceasefire is fragile. Israel has continued its assault on Lebanon, insisting the truce does not include its operations against Hezbollah. Pakistan's prime minister has already called out violations and urged restraint. The two-week window gives negotiators time. It does not guarantee a permanent resolution.
The airline stock rally — what it tells you
Global airline stocks surged on the ceasefire news. Qantas jumped more than 9%, Cathay Pacific climbed 5% and IndiGo rose 8%. In Europe, TUI was up more than 12%, Wizz Air gained 10%, Air France-KLM climbed around 14% and Lufthansa was up 11%.
The Wizz Air move is the most telling. A 10% gain in a single session for the most shorted stock in Europe — as covered here earlier this week — represents aggressive short position unwinding as hedge funds reassess a thesis built on prolonged fuel disruption. Whether those positions return depends entirely on whether the ceasefire holds and the Strait remains genuinely open.
The rally reflects relief, not resolution. Delta's guidance, issued yesterday morning before the ceasefire announcement, projected $4.30 per gallon fuel in the June quarter on more than $2 billion of additional fuel cost versus a year earlier. The forward curve will move on ceasefire news. Whether it moves enough to change that guidance materially is a question the next two weeks will answer.
What to watch today
The EASA bulletin decision is the immediate aviation event — we will publish a full reaction piece as soon as it lands.
Islamabad negotiations begin on April 10. Whether US and Iranian delegations produce a framework that extends the truce will determine whether yesterday's fuel price relief is structural or temporary.
Oxford Economics economist Aaron Goldring noted there is typically a tail of around seven months post-ceasefire of sentiment impact, with the perception of safety coming back gradually. Airlines plan summer schedules months in advance. The commercial recovery from this crisis will be measured in quarters, not days.
