Arif Habib warns PIA could shut down if jet fuel prices remain elevated

Pakistan International Airlines Consortium Chairman Arif Habib has warned that PIA’s operations could become unsustainable if jet fuel prices remain at current levels and urged the government to reverse the recent increase.

Speaking in a televised interview, Habib said the airline had managed to continue operations so far, but the rise in aviation fuel prices would make it difficult for PIA to keep operating in the coming period.

Official rates showed that JP-1 prices were increased by Rs84 per litre, or 21.65%, to Rs472 per litre from Rs388 per litre with effect from March 21. Since March 1, the rate has risen from Rs190 per litre, taking the overall increase to nearly 150%.

Habib linked the rise in aviation fuel prices to the government’s attempt to manage the fiscal burden of rising oil prices on ordinary consumers through cross-subsidy measures.

He said the government had increased the prices of aviation fuel and high-octane products to raise funds, while also relying on savings generated through austerity measures.

According to Habib, fuel prices in Pakistan had been raised but not in line with global market movements. He said the government appeared to be sharing the burden partly through austerity savings and partly through cross-subsidisation.

He also said treating aviation fuel as unrelated to the public was a policy mistake, arguing that the impact of higher aviation costs ultimately reaches ordinary people as well.

The PIA consortium chairman said the airline had “somehow” managed the current month, but described the increase as unsustainable for future operations.

He warned that if the government did not reverse its decision, PIA would not be able to continue operations and could be forced to shut down.