As the prospect of U.S. and Israeli military action in Iran loomed in the closing days of February, the likelihood of any conflict leading to the closure of the Strait of Hormuz — through which about 25% of the world’s seaborne oil trade passes — was keenly debated by observers.
On Feb. 27 — the day before the U.S. and Israel launched the first strikes against the Iranian regime — independent economic advisory firm Oxford Economics said there was a 45% probability the Strait would remain open, a 30% chance there would be low-level shipping disruption for two months, and just a 5% risk of a severe disruption.
“Iran would struggle to fully close, let alone sustain closure of, the Strait of Hormuz against a rapid international response,” the briefing stated. And even in this scenario, Oxford Economics predicted such a closure would only last one week.
While other analysts believed the threat of a closure to be more severe, they all agreed on one thing — if it did happen, it would have a significant impact on global oil markets.
“A significant spike in oil prices would be inevitable and physical shortages would quickly develop if the disruption were to be prolonged,” the International Energy Agency (IEA) said in a release in the days preceding the war.
“While most of the oil transiting the Strait is destined for Asian markets, the impact of a disruption to the Strait would be global due to its immediate impact on pricing. The market impact would be exacerbated by the fact that, in addition to disrupting shipments of oil transiting the Strait, the vast majority of the world’s spare crude oil production capacity could be made unavailable as well.”
On March 4, just days into the conflict, Iran confirmed these worst fears, announcing the closure of the Strait — though it would later make exceptions for ships from certain “friendly” countries. The closure, completed through the laying of mines, and attacks from boats, missiles and drones, has ensured most ships choose not to risk sailing through.
The impact on oil prices has been staggering. Brent oil rose from $71 a barrel on Feb. 23 to $118 a barrel by April 29. As of May 12, it was $108 a barrel.
The high cost of oil has, of course, an impact that reaches far beyond the price of gasoline and aviation fuel — but the rising price of these two products has likely drawn the most international attention.
And while the price at the gas pump has risen markedly — by about 30% compared to a year ago — those in the aviation world are seeing an even more severe sticker shock, with some reporting a doubling in the cost of Jet A-1 fuel.
Airlines have been grabbing most of the media attention, with many dropping routes over the summer, and raising ticket prices to pass on the additional cost.
But the impact is certainly being felt in the vertical-lift world, too.
A matter of life and death
“We’ve noticed the impact as air ambulances at the same period as people have been noticing at the petrol pumps, because as soon as the petrol pump prices went up, [it was] the same with helicopter fuel,” Anna Perry, CEO of Great Western Air Ambulance in the U.K., told Vertical. “Our last two deliveries . . . have been, we believe, about double the cost of previous deliveries — and that situation will be replicated across the country.”
Air ambulances in the U.K. are charity-run, which means there is no customer onto whom the additional fuel costs can be passed.
“It is unprecedented — the rises that we’re seeing now are completely out of the ordinary and not something that we financially planned for; it’s not something that we could have anticipated putting in our budgets,” Perry said.
Great Western Air Ambulance covers a largely urban area that includes Bristol and Bath, and operates a fleet of critical care cars in addition to its helicopter — an Airbus EC135 — that provide it with another option if the aircraft is unavailable. But some air ambulance charities in the U.K. cover a region so rural, large or inaccessible that a helicopter is the only option.
And, aside from cost, operators in Europe are concerned about supply.
“Our supplier says that they’ve got four weeks’ worth of aviation fuel left,” Perry said. “We don’t know whether they’re going to be able to top it up, whether they’ve got contingency plans, [or] whether they’re going to be prioritizing larger customers over us.”
Perry is a member of Air Ambulance U.K. (AAUK) — the national association representing air ambulance charities in the U.K. She said the organization has asked the U.K. government to prioritize the use of aviation fuel and road vehicle fuel for air ambulance charities, to ensure they are still able to respond to life-critical situations and maintain their lifesaving services.
“When people think about supply chain problems for petrol, they think about queues at petrol stations, and air ambulance charities are thinking about whether somebody is going to die because of whether or not we can get to them,” Perry said.
Cost, not supply, an issue in North America
On the other side of the Atlantic, Rick Kenin, chief operating officer of transport at Boston MedFlight, said the organization is facing a similar challenge with fuel cost — but not supply.
The nonprofit critical care transport provider has a fleet of five Airbus H145s across five bases, and typically records over 600 flight hours per helicopter per year.
“In the last eight weeks, our cost of fuel — depending on which base we’re looking at — has risen between 28% and 43%,” Kenin told Vertical. “That’s a significant increase in our cost to transport patients, and unlike the airlines or others, we can’t attach a fuel surcharge to our charges — we get reimbursed what we get reimbursed.”
He said the operator would have to increase its fundraising efforts to cover that increased fuel cost, and is already looking at cutting back on discretionary training and public relations events its aircraft are used for.
“We’re certainly looking at things that we can postpone or cancel to try to save funds, especially when flying the helicopters,” Kenin said. “But across the company, we’re looking at things we can do.”
In terms of how quickly prices may return to more “normal” levels, he said his suppliers expect it’ll take six to eight weeks once a permanent end to the conflict in the Middle East is secured.
Mathew Bolin, an instructor pilot at Phoenix Police Department’s Air Support Unit, said the rising cost of Jet A-1 fuel has become “a significant concern” for the unit, with an increase of between 35% and 55% since the start of the war with Iran.
Like many parapublic agencies, the unit is provided a budget for the fiscal year, and this takes into account the historic cost of fuel.
“If we exceed the budget for fuel, funds from other general ledgers — such as parts and maintenance — will need to be reallocated to help cover the additional fuel costs,” Bolin said.
While the unit has not yet seen any impact on its normal day-to-day operations, “If the rising costs of Jet A fuel do not stabilize, we may need to cut funding in other areas,” he said. “[This] could adversely affect essential services and operations that depend on our budget.”
Mark Schlaefli, owner of Dakota Rotors LLC in Custer, South Dakota, said fuel and insurance are the biggest cost variables that are mostly out of operators’ control.
“If I have a rise of more than 10% over what I determine to be a median price that fits within our business model, then I just pass [that cost] on to the consumer,” he said. “It certainly affects the cost of our services.”
The company provides a variety of utility services with a fleet that includes a Bell 206L-4, Robinson R66, and Robinson R44.
Schlaefli said that he still buys fuel wholesale for about $4.30 per US gallon, but has seen it being sold for $10 or $11 per US gallon in some airport locations.
One of the solutions he has found is buying in bulk — taking 8,000 to 12,000 US gallons at a time rather than 3,000.
However, Schlaefli said he was positive about the future outlook, especially with supply not being a problem in North America.
“I don’t really see it getting much worse,” he said. “And at these elevated prices, it’s still sustainable and still works OK.”
How to mitigate the rising cost of fuel
“The smaller operators are going to feel the pain initially, because they’re unable to hedge fuel costs,” Francois Lassale, CEO of Vertical Aviation International (VAI) told Vertical. “It remains one of their biggest variable costs . . . it’s difficult for everybody to absorb these costs right now.”
Lassale said many operators — particularly those in the parapublic world — are tied to contracts where it can be difficult to pass the rising cost of fuel onto customers. He referenced his previous role running an operator in Southeast Asia, and how he made sure to build in accommodations for fuel price variability.
“If fuel prices surged, then the customer would carry some of that cost as well,” he said. “From [VAI’s] perspective, we can give advice around contract structures, where it’s possible to incorporate the fuel adjustment in clauses, with shorter pricing windows to reflect market conditions, for example.”
He also urged companies to focus on using data to understand how they operate their aircraft and the routes they use, with an emphasis on fuel planning and weight management. Bulk purchasing with longer term agreements with fuel suppliers could also help, and Lassale said he’d heard of some operators forming consortiums with each other to be able to place a bigger fuel order at a reduced cost per liter.
“Some operators are reporting being quite selective about what flying they do at the moment, so anything not essential is being deferred,” he added. “My concern is whether operators cut from training and safety. Training still needs to continue to happen, but it’s often an easy place to default to. ‘Well, if we just trim our training a little bit, we’ll save some dollars there.’ ”
With the rising cost of fuel, governments will be taking in more money in the form of fuel tax — and Lassale said it would be “very helpful” if they could reduce the tax rate on fuel to give U.K. and European operators, in particular, “a bit of a tax break.”
One fixed-base operator (FBO) in the U.S., who spoke to Vertical on condition of anonymity, said each of its locations is simply “following the fuel trend” in terms of price hikes. “There is no certainty there will be an immediate decrease [should the Strait of Hormuz be reopened],” they said. “Each location will continue to base our pricing from our fuel provider.”
Investment bank JP Morgan appears to agree that we shouldn’t expect a quick return to pre-war fuel prices. In mid-May, the company released its analysis that predicted oil prices would remain in the “low $100s” for most of this year — even if the Strait of Hormuz is opened as early as June.
Meanwhile, energy companies have reported jumps in profits in their latest quarterly financial results. Shell had a profit of $6.92 billion in the first quarter (up from $5.58 billion in the same quarter of 2025), BP’s profit more than doubled over the first quarter last year, while Norwegian company Equinor said it has recorded its highest quarterly profit for three years.
Lassale said the current situation highlights the need for improved efficiency across the vertical-lift industry — whether through the use of sustainable aviation fuels (SAF) or the benefits promised by hybrid propulsion systems currently in development at engine manufacturers.
SAF has long been heralded as representing the “low hanging fruit” for operators to reduce their environmental footprint, but supply and its cost — typically two or three times that of Jet A-1 — have limited its use, particularly in the rotary industry. But while jet fuel has recently doubled in cost, SAF has only increased 30% — meaning it is now closer to 1.5 times the price of Jet A-1.
“There’s ways that we can get to that sort of critical mass for economy of scale [in SAF],” Lassale said. “We need to do that quicker, because I think we’re always going to see volatility in the oil market. If we can get to operating SAF quicker, it’s a good thing.”