Singapore — Singapore Airlines and its regional unit SilkAir will temporarily reduce services across their network because of the coronavirus outbreak reducing demand, the company said Tuesday.
The move will further add to the drop in demand for jet fuel caused by the virus.
The list of affected destinations included Frankfurt, New York, Los Angeles, Seattle, Paris, Copenhagen, Dusseldorf, London, Tokyo, Busan, Seoul, Taipei and Jakarta, the company said in a statement.
"We will continue to monitor the situation and make further adjustments as necessary," it added.
Aviation fuel demand is coming under pressure as the tourism sector in Asia is starting to be hit.
S&P Global Platts Analytics worst-case scenario shows a drop of 1.125 million b/d in global jet demand in February; its best-case scenario shows a drop of 876,000 b/d in for February.
As a result, the cash differential for jet fuel cargoes loading in Singapore as assessed by Platts was minus 20 cents/b at the Asian close Tuesday, down 24 cents week on week.
In the derivatives market, the March/April contango was the widest for a front-month spread in nearly 10 months at 35 cents/b Tuesday.
Various restrictions on travel have been introduced in the region to help stop the spread of the virus. Earlier in February, Malaysia expanded its ban on visitors from China's Hubei province to include Zhejiang and Jiangsu provinces. This came after China extended its lockdown to five cities in Zhejiang, and two cities in Jiangsu.
In Singapore, which has one of the higher number of confirmed infections outside of China, the government raised its risk assessment of the coronavirus disease situation in the city-state, and also announced it would refuse entry or transit to new visitors who had traveled to China within the last 14 days.
In addition, visa-free transit facilities and new visas for Chinese passport holders have been suspended. Chinese tourists account for around 20% of international visitor arrivals into Singapore, according to the Singapore Tourism Board, which is also forecasting a 25%-30% fall in visitor arrivals this year, surpassing the 19% drop during the 2003 SARS outbreak.