Cathay Pacific's passenger traffic rises 10% MOM in October amid higher jet fuel prices

Hong Kong's Cathay Pacific passenger traffic rose 10.44% month over month and 19.6% year over year to 2.01 million passengers in October, the company said late Nov. 21, coinciding with a increase in jet fuel prices throughout the month.

Over January-October, the number of passengers reached 18.57 million, 27.4% higher from the same period a year ago.

The flagship carrier's revenue passenger kilometers rose 19.1% year over year in October, while the carrier's capacity, measured in available seat kilometers, expanded 21.3% year over year. Over the same period, passenger load factor fell 1.6 percentage points to 83.1%.

"October was another good month for our travel business, with strong demand for both leisure and business travel resulting in a solid load factor of 83% across our network. We saw considerable leisure traffic from Hong Kong and the Chinese Mainland to destinations in Southeast Asia, Northeast Asia and Europe over the National Day 'Golden Week' holiday at the beginning of the month," Cathay Pacific Chief Customer and Commercial Officer Lavinia Lau said in a statement.

Reflecting the uptick in air travel demand, the Platts-assessed FOB Singapore jet fuel/kerosene outright price averaged $87.93/b in October, up from $84.46/b in September, S&P Global Commodity Insights data showed.

Meanwhile, the airline carried 142,323 mt of cargo in October, up 6.94% month over month and 14.3% year over year, Cathay reported. This brought total tonnage in the first ten months of the year to 1.25 million mt, 10.4% higher than the corresponding year-ago period.

"For cargo, the robust demand we have been seeing is expected to continue throughout the rest of the peak season, driven by e-commerce, high-tech and electronic goods from the Chinese Mainland and Southeast Asia, as well as perishables from the South West Pacific and the Americas," Lau said.

Robust jet fuel demand expected in Q4

"Looking ahead, we are projecting a strong Christmas travel peak, with Japan anticipated to be a top destination for outbound travel from our home market. We are also expecting considerable inbound demand from North America, the United Kingdom and other destinations in Europe as customers travel to visit friends and relatives," Lau said.

Global seat capacity in November will reach 466 million, up 5.2% year over year, in line with the trend in recent months, according to aviation data company OAG. The increase translates to 22.8 million additional seats, with Northeast Asia leading the way, accounting for 5.8 million of the added capacity.

Based on OAG's current forward-looking capacity, global airline seat capacity is projected to continue trending downward to 108.9 million seats in the week to Dec. 8, before increasing amid the year-end festive season.

"In Japan, record visitor arrivals are driving jet fuel demand in the fourth quarter and coupled with the seasonal uptick in kerosene demand during the coming winter, which is expected to be severe compared with last year," Commodity Insights analysts said in their latest short-term outlook, adding, however, that the country's recent earthquakes could dampen tourism.

Jet fuel demand in Asia is projected to grow 327,000 b/d year over year in the fourth quarter of 2024, according to the analysts.