Second US airline curbs East Asia service as outright jet pricing tumbles

United Airlines became the second US carrier to extend route modifications beyond China amid the spread of the coronavirus Friday, after outright jet fuel pricing slipped to a two-and-a-half year low.

On Friday the airline announced it would be suspending service to Tokyo, Osaka, Singapore and Seoul, though details on the time frame were not provided.

The announcement followed that of Delta Air Lines, who announced on Wednesday its move to curb flights to South Korea, altering service to Seoul-Incheon International airport until April 30. The airline did not announce service modifications to other East Asian countries at the time.

Since the first US carrier's announcement of suspended service outside of China, outright jet fuel pricing on the Gulf Coast has sunk to a two-and-a-half year low.

On Thursday, S&P Global Platts assessed benchmark Gulf Coast pricing at NYMEX April ULSD futures minus 10 cents/gal, or $1.3871/gal.

While the differential was at a one-week low, outright pricing was the lowest since July 12, 2017, when value was seen at $1.3862/gal.

Similar to their global counterparts, three major US carriers — United, Delta and American Airlines — announced service reductions to China at the end of January amid the coronavirus outbreak, as jet fuel demand across the country, and the globe, was slashed.

Following global carriers' move to reduce China service, the Gulf Coast jet differential sank as low as NYMEX ULSD futures minus 14.50 cents/gal on February 3, a two-year low.