“We are currently seeing a combination of pent-up demand and limited supply,” Desai told the publication.
This situation is similar to when Comair’s British Airways and Kulula.com flights removed 40% of the local airline capacity in March, making it that more expensive to travel.
“As a result of the Covid pandemic, some airlines have stopped flying internationally, while others have not returned to full operation yet. Pricing will always be more competitive when demand is less than supply. That is currently not the case,” explained Desai.
UKRAINE-RUSSIA WAR ALSO IMPACTING FLIGHT PRICES
“Regardless of supply and demand, the oil price will likely have a huge impact on airfares. Whereas previously airlines used to review prices every Tuesday, they are now continuously adjusting fares,” Desai said.
He also highlighted that it is difficult to say whether demand and supply will ever return to pre-pandemic levels.
“It is important to keep in mind, however, that the travel industry is recovering from what has arguably been the most challenging time in the travel and tourism [sector’s] history. This will undoubtedly lead to some unexpected situations. Our industry is well on the way to full recovery, but it will take a little time.”