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Gulf crisis affects Australian and New Zealand companies, from airlines to banks
The U.S. and Israel war on Iran is causing financial stress for companies in Australia and New Zealand. Higher fuel prices are stoking inflation, reducing consumer and business confidence and weighing on corporate earnings. Below are some of the companies from Australia and New Zealand who have reported an impact on their business due to the Middle East conflict. Air New Zealand, New Zealand's flag carrier, announced that it would be raising fares in response to the volatility of jet fuel prices in early March. It was one of the first airlines to do so. The airline announced on April 7 that it would cut?flights throughout May and June. This will affect around 4% flights and 1% total passengers. Auckland International Airport, New Zealand: Flights from Auckland to the Middle East have been disrupted. In March, the number of passengers on Middle Eastern routes dropped by 81% and seat capacity fell by 73% compared to a year earlier, according to airport operator. New Zealand-based a2 Milk has cut its profit forecast for fiscal 2026 as higher freight costs and supply chain disruptions due to conflict have affected the availability of the China-label infant formula product on its largest market. Cleanaway Waste Management: The company has slashed the full-year forecast for operating earnings by approximately A$20,000,000 ($14.17million), due largely to higher costs, reduced activity, and differences in timing of cost recovery. Cochlear, an Australian manufacturer of hearing implants, has lowered its profit forecast for 2026 due to weaker trading on developed markets. The company cited slower "surgical volumes", fewer referrals for hearing aids, and a softer consumer mood. The company stated that the Middle East War has increased risks for order cancellations, delays in delivery, and a higher exposure to receivables. This, combined with worsening margins and restructuring costs, have led to a reduction of its 2026 profit forecast. Fletcher Building, New Zealand: Fletcher Building, New Zealand, said that it is indirectly exposed to the Middle East conflict through supply chains, freight lines, energy costs and the wider economic impact of construction demand in Australasia. Construction materials manufacturer expects to increase prices in all divisions as a result of passing on costs to its customers. Plastics, where the company claims immediate exposure is present, will be subject to price increases of up to 36%. Other divisions are expected to see a 1%-5% increase. Fonterra New Zealand, a dairy producer, said the conflict could impact its supply chain and increase its inventory and costs in second half of year. It also contributed to volatility in global commodities prices. National Australia Bank: National Australia Bank said it expected to incur credit impairment costs of A$706 (504.44 millions) during the first half fiscal 2026. NAB stated that the volatility of interest rates in the second quarter, the weaker New Zealand Dollar and the increase in provisioning would result in a reduction of the group's?common equity tier 1 capital rate by approximately 20 basis points on March 31. The company also plans to apply a discount of 1.5% to its dividend reinvestment program for the first half to raise A$1.8 billion and help strengthen its balance sheet. Orora Packaging Company: Orora has lowered its earnings forecasts for its French division Saverglass, and cancelled the share buyback program. The company cited the impact of war. Due to the closing of shipping routes, the company also stopped bottle production in its glass production plant at Ras al-Khaimah (United Arab Emirates). Qantas Airways: Qantas Airways is Australia's national carrier. It has raised its fuel costs outlook for the second part of the year up to A$800m and announced that it will not be starting its planned A$150m share buyback, citing the sharply higher jet fuel prices. Qantas has increased fares to offset the rising cost of its flights and is shifting them towards stronger routes, such as Paris and Rome?where demand is strong, and cut domestic capacity by approximately 5 percentage points during the June quarter. Qube Holdings : Qube anticipates that the Middle East conflict will have an impact on its EBITA of between A$10 and A$20 million in fiscal 2026. The logistics company said, however, that recent events could encourage an acceleration of investment in new projects involving alternative energy, which could prove beneficial for the firm. Virgin Australia: Virgin Australia expects fuel costs to increase by around A$30 to A$40 Million ($21.39 to $28.52 millions) in the second half fiscal 2026. In mid-March, the airlines announced that they were adjusting their fares due to the rising costs in the aviation industry. Westpac: Westpac, Australia's no. Westpac, Australia's no. Westpac's net margin for its Treasury and Markets division has been weakened due to interest rate volatility related to the conflict. A weaker outlook is already leading to higher credit provisioning. Westpac's provisioning of?potentially bad debt? is at its highest level since the COVID-19 Pandemic. Woolworths Woolworths is the largest Australian supermarket. It said that the Middle East conflict had created uncertainty for both customers and suppliers. This has exacerbated the already severe cost of living pressures. Fuel price pressures, customer retention investments and fuel price increases will all affect the firm's forecasted growth in domestic food segment earnings for fiscal 2026. Woolworths has also announced that it will freeze the prices of 300 household staples from May 1 for three months. This is due to cost pressures imposed by Australian suppliers, which are driving up prices across all supermarkets. Worley: Worley estimates that the negative impact of the Middle East conflict will be between A$30 and A$40 millions on its underlying EBITA in fiscal 2026. The Australian engineering company warned that it would not be able to grow its underlying EBITA by more than 5% in fiscal 2026 but aimed to increase revenue by more than 5% in fiscal 2025.
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Russian drones struck Ukraine's Odesa over night, injuring 18, officials claim
Officials said that Russian drones had attacked Odesa, Ukraine's south city, overnight, for the second time in a week. They injured at least 18 people, and damaged residential buildings. Serhiylysak, head of local military administration, stated that the strikes caused the most damage in the central Prymorskyi District, where residential buildings with five stories and high-rises were damaged. Lysak, the head of the local military administration, said that large fires were started in upper floors as well as on a rooftop. These have since been put out. The number of injured is still subject to change, according to emergency services. Odesa is a major Black Sea Port and a focal point for Ukrainian exports. It has been repeatedly targeted by Russian attacks over the past four years of Russia's conflict. In a?attack that occurred on Monday, 14 people were injured. Ukraine's air force said that Russia launched 206 drones and one ballistic missile at the country between 6 pm (1500 GMT) Wednesday, 172 of which were neutralized or downed. It added that one missile and 32 drones were fired at 22 different locations. Lysak stated that a 17-year old boy was one of the injured, and two others were in serious condition?in intensive care. He also reported that an administrative building, a shopping center, and a hotel had been damaged. He posted pictures of a fire that was raging inside a building, with its upper floor being damaged. Flames and heavy smoke were also seen billowing out from the high-rise. He added that dozens of 'buses and vehicles have been damaged or destroyed at various parking areas. He said that in another district, there were strikes at warehouses, infrastructure buildings, and garage cooperatives. (Reporting and editing by Anna Pruchnicka.
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DHL's operating profit increases thanks to cost and capacity management
DHL, the German logistics giant, reported on Thursday a higher than expected 'first-quarter operating profits', helped by structural cost reductions, capacity management and yield measures. Tobias Meyer, CEO of the company, said that despite closed airspace and blocked sea routes, they kept cargo moving. The company's?quarterly profit before interest and tax was 1.48 billion euros ($1.73billion), exceeding analysts' expectations by 1.38 billion, according to a consensus provided by the company. The?quarterly operating margin increased to 7.3%, up from 6.6% in the same quarter?last. Meyer stated that "after the first three month, we are on track to reach our full-year goals." In March 2025 the company announced its biggest cost-cutting program in two decades, as a way to protect its margins during a period when shipping and logistics firms are facing trade disruptions. Analysts were expecting European logistics companies to see their first-quarter earnings benefit from higher freight costs - and supply chain complexity - resulting from the U.S./Israeli war against Iran. DHL was seen as one of the key beneficiaries due to a'spillover' effect from air to sea freight.
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Sources say that Apollo, Blackstone, and KKR are competing for Shell's stake in LNG Canada.
Three people with knowledge of the situation said that Apollo Global Management is in a fierce battle to buy a large stake from Shell's energy?major, LNG Canada. Three of the largest asset managers in the world, the 'trio', remain as bidders for the Shell auction, which attracted interest from large money managers, infrastructure investors, and other major companies. Several people have said that the deal could be worth more than $10 billion or even $15 billion. The bidding process is confidential, so everyone who spoke to asked that their names not be used. Shell, who announced on Monday a $16.4billion deal to purchase Canadian natural gas producer ARC Resources, will be able to sell a large portion of its 40% stake in LNG Canada. This sale is also an opportunity for Shell to attract new capital into the LNG Canada export project, ahead of any expansion. LNG Canada is the first major North American liquefied gas facility with direct access into the Pacific Ocean. This allows it to ship directly to Asia, its largest market, where the super-cooled fuel can be sold. Shell will sell the exposure to the first and second phases to one bidder rather than splitting it up, as was originally reported in January. People said that Shell or any of Apollo, Blackstone or KKR might win the final battle, or Shell may retain some or even all of its stake. Shell declined to make any comment. Shell declined to comment. Apollo, Blackstone, and KKR all declined to comment. Insurers Money Shell is the biggest backer of LNG Canada. Other owners of LNG Canada include Japan's Mitsubishi Corp., Malaysia's Petronas and?MidOcean. This joint venture between investment firm EIG, and Saudi Aramco. LNG Canada's appeal has only grown in recent weeks as North American energy assets are benefiting from the free movement of oil and gas due to Middle Eastern energy supply being throttled by the U.S. Iran war. Some people have said that all three asset managers - Apollo Athene's, Blackstone Credit & Insurance's and KKR Global Atlantic's - are using capital from their respective insurance businesses to boost 'their bids. In recent years, money managers have increased their use insurance assets as low-cost sources of funding for other strategic areas in their business. These investments are best made with infrastructure assets, which are low-risk and have a long lifespan. Blackstone, as an example, used its insurance division last year to support a joint venture that included EQT. EQT owns a large number of stakes in the U.S. natural gas producer.
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AirTrunk, an Australian company, invests $3 billion in two new data centers in Malaysia
Australia's?AirTrunk?said Thursday that it would invest $3 billion in?building two hyperscale?data?centers?in Malaysia, doubling its existing business there. The two data centres, which will be located in Johor Bahru have a combined power of over 280 megawatts. They are also close to the existing AirTrunk data center campuses. AirTrunk said that the four data centers would have a capacity of more than 700 Megawatts and the investment value in Malaysia will be $6.8 Billion. AirTrunk CEO Robin Khuda said that the demand for cloud-based AI infrastructure in Asia-Pacific was growing faster than expected. "Our job is not only to be ahead in one market but also across the entire region." AirTrunk is owned by a Blackstone consortium and announced last week that it would purchase Indian data centre developer Lumina CloudInfra to expand its business in India. AirTrunk said that it planned to?spend $5 Billion in India. AirTrunk said that once the Indian deal has been completed, it will have more than three gigawatts of planned and operating capacity across?20 data centres in six regions. The consortium bought the Australian-based firm in 2024 for A$24 Billion ($17.11 billion), which was the largest deal at the time.
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Spirit Airlines delays rescue hearing as talks continue
Spirit Airlines has said that no bankruptcy court hearings will be held on Thursday, as talks with lenders continue over terms of a possible $500 million U.S. Government?rescue. In a court document filed on Wednesday, the airline said that talks are continuing and that lenders haven't filed a notice in New York Federal Court that would trigger a liquidation within seven business days. Last week, President Donald Trump stated that his administration was interested in buying the struggling airline for the "right price." The Florida budget carrier is running out of time. Marshall Huebner, a Spirit lawyer, said that Spirit urgently needs to access $240 million in funds or new financing. He said that the liquidation of Spirit could result in more than 17,000 job losses and a 'billions of dollar' worth of claims. Last week, a lawyer for Spirit?creditors stated that they had reviewed the term sheet of government's offer. Sources say that it includes $500 million of financing and that government must receive warrants equivalent to 90% of Spirit?s equity. Spirit would be able to avoid its second bankruptcy since 2025 with the senior debtor in possession financing. Separately budget airlines have requested $2.5 billion from the Trump administration to help offset the increase in jet fuel prices during the U.S. - Israel war against?Iran. Sean Duffy, Transportation Secretary, said that Congress would have to be involved in this request. "I don't have the money. I can't pull it from my couch cushions. It would take a lot of government involvement and bipartisan efforts to find the money for them. Duffy said on Tuesday that you can't just snap your fingers. JetBlue Airways CEO, Joanna Geraghty, said that the airline is focusing on its turnaround strategy and was not interested in government assistance. She added, however, "Never say Never -- We're open for anything, as long as the terms make sense to JetBlue."
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C.H. Robinson's quarterly profits beat estimates due to cost-control measures
Freight forwarding firm C.H. Robinson's 'first-quarter' profit surpassed Wall Street expectations on Wednesday. It was helped by its use of AI agents to reduce costs. This sent its shares up 4% after-hours. In the past few quarters, there has been a reduction in the number of employees and an increase in the use of artificial intelligence to perform routine functions such as pricing shipments and monitoring cargo while it is in transit. This approach has helped the largest U.S. trucking firm to keep its margins more insulated against a prolonged slump in demand, which has affected rates and most trucking firms earnings. According to LSEG, the company reported a 'adjusted profit per share' of $1.35 in the first quarter. This was above analysts expectations of $1.24. The quarterly?revenue fell by 0.8% compared to a year ago, falling to $4.01 Billion. Analysts ?on average ?expected $4.03 billion. Reporting by Nandan Mandyam in Bengaluru and AnshumanTripathy; editing by Jonathan Ananda
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Airline cancels flights due to Middle East conflict
Middle Eastern carriers increased capacity after the U.S. - Israel war against Iran caused severe disruption. Airlines outside the Gulf are continuing to reroute routes between Europe and Asia, away from major hubs in the region. The latest flight information is listed below alphabetically: AEGEAN AIRLINES The largest airline in Greece will resume its flights to Tel Aviv on April 28 from?Athens, from Heraklion and Rhodes on April 30, and from Larnaca and Rhodes on May 21. Thessaloniki-Tel Aviv flights are cancelled through June 26. Flights to Riyadh & Amman will resume on May 21. The flights to Beirut and Dubai are cancelled until the 26th of June. AIRBALTIC Latvian airline airBaltic has announced that flights to Tel Aviv are cancelled until 28 June. Dubai flights are cancelled until 24 October. AIR CANADA The Canadian carrier has canceled flights to Tel Aviv, Dubai and Abu Dhabi until September 7. AIR EUROPA Spanish Airlines has cancelled all flights to Tel Aviv till May 31. Air France-KLM Air France suspends its flights to Tel Aviv, Beirut and Dubai until May 10. KLM suspends flights to Riyadh and Dubai until the 14th of June. CATHAY PACIFIC Hong Kong Airlines has suspended its flights to Dubai, Riyadh and cargo freighter service to Dubai, Riyadh and Dubai until June 30, and until May 31, respectively. In April, the airline will increase passenger flights to London, Paris, and Zurich to meet a surge of demand for travel to Europe. It intends to continue all scheduled flights after June. The U.S. carrier plans to resume New York JFK to Tel Aviv service on September 6 and has extended the suspension of Atlanta-Tel Aviv services through November 30, The launch of the Boston-Tel Aviv service, originally planned for October, has now been postponed until further notice. EL AL ISRAEL AIRLINES Israel's carrier announced that it will continue to expand its operations and, from April 27, operate flights?to approximately 40 active gateways. The cancellation of all flights to Dubai is in effect until May 31. EMIRATES The UAE airline announced that it will be operating a reduced schedule and flying to over 100 destinations. ETIHAD Airlines, the United Arab Emirates airline, has announced that it will operate a commercial flight schedule from Abu Dhabi to around 80 destinations. FINNAIR The Finnish airline has cancelled all flights to Doha until July 2 and continues to avoid the airspace over Iraq, Iran Syria, and Israel. Dubai flights will only be resumed in October. British Airways, owned by IAG, will?reduce flights to the Middle East once services resume. They will permanently?drop Jeddah from their list of destinations, adding more capacity for India and Africa. Plans to reduce service to Dubai, Doha, and Tel Aviv from two daily flights to one daily flight by July? Riyadh service will be reduced from two to one daily flight from mid-May. The changes will apply until the end of the summer season on October 24. One Dubai service will restart on October 16. Iberia Express, the Spanish low-cost carrier of IAG, has cancelled all flights to Tel Aviv until May 31. JAPAN AIRLINES Japan Airlines has suspended its scheduled Tokyo-Doha and Doha-Tokyo flight until June 1 and until May 31. The Polish airline has suspended flights to Tel Aviv till May 31. The airline also cancelled flights from March 31 until May 30 to Beirut and Riyadh. The airline will operate its winter route from Dubai to October. LUFTHANSA GROUP Lufthansa has suspended its flights to Dubai, Tel Aviv, and Austrian Airlines. The suspension of flights to Abu Dhabi is in effect until October 24, as are those to Amman, Beirut Dammam, Riyadh Erbil Muscat Tehran. Eurowings, a low-cost airline, has suspended flights from Tel Aviv to Beirut until May 11 and Erbil to Erbil until May 14. Flights to Dubai and Abu Dhabi have also been suspended until October 24. ITA Airways has extended the suspension of flights from Tel Aviv, Riyadh, and Dubai to May 31. MALAYSIA AIRLINES Malaysian Airlines has suspended all flights to Doha through June 14. NORWEGIAN AIR The low-cost airline has delayed the launch of its Tel Aviv and Beirut service until June 15. PEGASUS Pegasus Airlines, Turkey's national airline, has cancelled all flights to Iran, Iraq, Amman Beirut, Kuwait Bahrain Doha Dammam Riyadh Dubai Abu Dhabi Sharjah and Abu Dhabi until June 1. QANTAS Australia's flag airline is adding more flights to Rome and Paris in response to a surge in demand for European destinations. The number of flights to Paris is increasing from three to five per week, and the Perth to Singapore service will go from daily to ten flights per day. A new schedule will be implemented gradually for flights starting in mid-April, and running until late July. QATAR AIRWAYS From May 1, the carrier will resume daily flights to Damascus and Bahrain, as well as Kozhikode. Qatar Airways has announced that it will expand its international flight network from June 16 to more than 150 destinations. ROYAL MAROC The Moroccan carrier announced that flights to Doha and Dubai were cancelled until 30 June. SINGAPORE Airlines In response to increased demand, the carrier has extended its Singapore-Dubai suspension flight until May 31 and added?services along the Singapore-London Gatwick route from late March to October 24. TURKISH AIRLINES SunExpress - Turkish Airlines' joint venture Lufthansa has cancelled flights from Dubai to May 21. WIZZ AIR Low-cost carrier suspends flights from Europe to Amman, Dubai and Abu Dhabi until mid-September. All flights to Medina are suspended indefinitely. (Compiled by Josephine Mason and Jamie Freed. Elviira Loma, Tiago Branao, Agnieszka Olesnska, Bernadette HOG, Boleslaw LaSocki, Romolo Tosiani. Rod Nickel, Lisa Shumaker, and Jonathan Ananda edited the book.
Fuel costs and China's top airline's Q1 profits cloud the outlook
China's top three state-owned carriers returned to profitability in the first quarter. This was due to the robust demand for travel during the Lunar New Year and the recovery of global travel. However, the outlook has been overshadowed by higher fuel prices because of the war in Iran.
China Southern Airlines, based in Guangzhou, reported a net loss of 747 millions yuan for the same period of last year.
Air China, the country's flagship carrier, posted a net profit of 1.71 billion Yuan compared to a loss last year of 2.04 billion Yuan. Shanghai-headquartered China Eastern Airlines reported a net profit of 1.63 billion yuan, versus a year-earlier loss of 995 million yuan.
China Southern, Air China, and?China Eastern all saw their Hong Kong shares drop by as much as 2,7%, 2,9%, and 2.3%, respectively.
China Southern and its subsidiary Xiamen Airlines signed agreements with Airbus on Wednesday to buy 102 and 35 A320neo aircraft respectively.
Catalogue prices for the 137 planes are around $21.4 billion. Deliveries will be made in phases between 2028 and 2032. China Eastern announced a deal last month with Airbus for the purchase of 101 A320neos in a deal valued at $15.8billion.
The three airlines said that a renewed focus of the international market is a key growth driver, as they are operating'some flight routes via Russia which bypass the Middle East.
Air China's international passenger traffic increased by 28% in March. China Southern also saw a rise of 23%, and China Eastern experienced a rise of 22%.
Bank of America recently released a report predicting that Chinese airline capacity will grow by 13% annually in summer 2026. This would bring it to 91% of the levels of 2019. Europe and Australasia are expected to be the main growth corridors.
China-North America routes are still lagging behind, with capacity for China-U.S.A. and China Canada at only 29% and 40% respectively of the 2019 levels.
HSBC analysts have warned that in a recent report, the Big 3 are "adversely positioned compared to peers due to a structurally price-sensitive travel cohort" in China. They also added that "rising costs of fuel weigh more on Big 3 profits as they struggle pass costs on without losing customers."
The global airline industry was expecting record profits in 2026 of $41 billion, but the doubled price of jet fuel has now put this at risk.
Jet fuel prices are 'nearly twice as high, outpacing an increase of?roughly 65 percent in crude oil prices. Major mainland Chinese airlines have increased domestic fuel surcharges by six times.
The major airlines have increased the surcharges for domestic flights to 60 yuan (8.80 dollars) for flights less than 800 kilometers and 120 yuan (120 dollars) if they exceed 800 kilometers, up from 10 and 20 yuan respectively.
Willie Walsh of the International Air Transport Association warned on Tuesday that the jet-fuel crisis could first hit Asia as a shortage in the summer peak season in the northern hemisphere becomes a growing worry.
The impact on routes has been rapid. Flight Master data shows that several?Southeast Asia route were cancelled between April 1, 2012 and?12. These include Xian - Phuket, Chongqing - Phuket and Hohhot - Bangkok. On Oceania, the cancellation rates were 83.3% for Guangzhou to Darwin, 57.1% for Hangzhou to Auckland and 50% for Wuhan to Sydney.
Li Hanming is an independent expert in China's aviation sector. He said that these routes were no longer viable commercially due to higher oil prices.
Li added that "carriers cannot really raise their fares, either," because it would dampen the demand. Reporting by Sophie Yu and Julie Zhu in Beijing, and Donny and Donny in Hong Kong. Editing by Raju Gopikrishnan.
(source: Reuters)