Jamie Freed, Rajesh Kumar Singh

SYDNEY/CHICAGO – Airlines fear a new round of instability due to Omicron’s COVID-19 variant. This could cause them to change their schedules or destinations quickly and to rely more heavily on local markets, analysts warn.

A lot of travellers already have booked Christmas trips, peak season for airlines. But industry worries are mounting about future bookings being halted and additional delays to an already slow recovery for business travel.

Fitch Ratings announced that its 2021-2022 global passenger traffic forecasts had been lowered. The emergence Omicron and other variants highlighted the fact that airlines will continue to face volatile conditions.

Deidre Furlton, a partner in consultancy MIDAS Aviation stated that “it feels a little like we’re back where we were a whole year ago” during an industry webinar.

Omicron’s effect will differ by country or region because of the variety of international airlines as well their business models.

The Gulf carriers took swift action to safeguard their hubs, restricting travel from south Africa and fearing the spreading of the virus would cause restrictions in other areas.

International travel is more volatile for airlines based in strong, stable countries like Russia, China, and the United States.

UBS analysis shows that U.S. carrier haven’t yet modified their scheduled capacity. This is at 87% of 2018 levels, with 92% expected to be available in January.

United Airlines launches its Newark to Cape Town route, despite a U.S ban on foreign citizens entering the country from South Africa. Delta Air Lines said that there were high bookings for Christmas.

“In the previous year, bookings have declined for each variant, and then increased once the surge has subsided.” Helane Becker from Cowen and Co., said that the pattern is likely to continue.

Kayak, a travel booking site, reported that international searches for American travelers were only down 5% Sunday. This contrasts with a 26% drop in British searches. Britain had increased testing requirements.

The Omicron variant puts major European airlines at greater risk because they are more dependent upon international travel than counterparts in the United States.

Johan Lundgren (CEO of easyJet) said Tuesday that short-term departures had suffered an impact, but not as severe as when the restrictions were in place.

Asia’s countries such as Australia, Japan, Singapore, and Thailand have only recently begun to lift some border restrictions. However, passenger numbers remain at small fractions of the pre-pandemic levels.

John Grant is chief analyst of OAG travel data firm. He said that although the Omicron moves were disappointing and frustrating, they had a small impact on travel.

He said that airlines around the world have shown greater flexibility in adapting their destinations and schedules to accommodate pandemics. This trend is likely to continue.