Data and industry collaboration are becoming increasingly important tools for airlines seeking to reduce fuel consumption as rising energy prices put further pressure on profitability, according to Stuart Fox, Director, Flight and Operations at the International Air Transport Association (IATA).

Fuel is expected to account for almost one-third of airline operating costs in 2026, with carriers forecast to spend around $350 billion on jet fuel.

IATA said the impact of higher and more volatile energy prices, driven in part by conflict in the Middle East, is expected to significantly reduce airline profit margins.

Global airline margins are forecast to fall from 4.2% in 2025 to just 2.0% this year.

While airlines may seek to pass higher fuel costs on to passengers, IATA noted that there are limits to how much travellers can absorb through higher fares.

Improving fuel efficiency has therefore become a major priority for carriers.

An IATA survey conducted in March found that 90% of airlines identified fuel efficiency as a top priority, rising to 96% among respondents working in finance and procurement.

With fleet renewal and network changes already providing many of the traditional efficiency gains, IATA said further savings will increasingly depend on data-driven operational decisions.

Better benchmarking can help airlines identify where fuel is being used inefficiently and compare performance with operators using similar aircraft on comparable routes.

IATA currently has access to real-time operational data from more than 240 airlines.

Its Fuel Efficiency Gap Analysis (FEGA) advisory service and FuelIS analytical platform help carriers identify potential savings by aircraft type, route, flight phase and region.

For example, benchmarking can reveal when an airline consistently lands with higher fuel reserves than comparable operators.

Such insights can highlight opportunities to reduce fuel burn while maintaining safety, with improvements supported through operational guidelines and staff training.

However, IATA stressed that airlines cannot address every source of inefficiency alone. Industry-wide cooperation, particularly in air traffic management, is also required.

More efficient flight trajectories and direct arrival routings can reduce unnecessary fuel consumption.

IATA is calling for continued modernisation of air traffic management systems and closer collaboration across the aviation sector.

With fuel costs placing growing pressure on airlines, the association said data, benchmarking and coordinated operational improvements will be essential to finding further savings and improving efficiency across the industry. -TradeArabia News Service