Here, there has been a reasonable improvement in domestic passenger traffic from the nadir, although it’s uncertain whether the momentum sustains. Ltd, said, “While the recovery in domestic traffic has been encouraging, it’s worth noting that average daily passenger run-rate has started to moderate this month. Going ahead, it is possible that the recovery may turn more topsy-turvy as seen in Europe/ US" He added, “As such, the recovery in domestic passenger traffic to pre-covid levels (FY20) could be prolonged." After touching a low of $19.33 a barrel in April, Brent crude prices are now trading at $51.29 a barrel. In general, if demand improvement coincides with higher crude prices then there could be pressure on profitability for airlines.

Source: Mint December 25, 2020 13:52 UTC