Dubai airport prepares for ‘slow recovery’

Dubai airport prepares for ‘slow recovery’
CEO Paul Griffiths, is urging countries to move away from mandatory quarantines on arriving passengers. (GettyImages)
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Updated 28 October 2020

Dubai airport prepares for ‘slow recovery’

Dubai airport prepares for ‘slow recovery’
  • CEO urges countries to move away from mandatory quarantines on arriving passengers

DUBAI: Dubai International Airport, the world’s busiest for international travel, is getting busier. But it’s a long way from what it once was amid the coronavirus pandemic as it prepares for a possible “extended, slow recovery,” its CEO told The Associated Press.

After long-haul carrier Emirates drastically cut its flights in March and slowly resumed its routes, passenger numbers at the mammoth airport serving East-West travel have crept up to over 1 million a month — just below 15 percent of what they were a year ago, CEO Paul Griffiths said.

To boost those numbers, Griffiths is urging countries to move away from mandatory quarantines on arriving passengers and toward the strategy embraced by Dubai. That includes aggressive coronavirus testing before departure, followed by mandatory mask-wearing on aircraft and testing on arrival.

“What we have to do is take appropriate measures to control and manage the risk, which actually are acceptable. I mean, life is full of risk management. It’s not all full of risk elimination,” Griffiths told the AP in an interview. 

“Surely the same should apply to the virus. We need to get it under control to minimize the risk of infection.

“And that can be done with some of the measures that we’ve got available to us without prolonging the social and economic damage that is currently being inflicted.”

Across the wider Middle East, passenger numbers this year are expected to reach only 60 million, down from 203 million in 2019, according to the International Air Transport Association. That’s only 30 percent of last year’s numbers.

The recovery may take years. By 2021, the trade group hopes to see 90 million travelers in the Mideast, still drastically lower than 2019. In order to get passengers flying before a vaccine is widely available, the IATA is calling for mass, rapid testing of passengers rather than quarantines by countries.

Those quarantines hobble those considering taking a trip, Griffiths said. Instead, countries should move toward offering electronic “health passports” or other measures to aid in ensuring safety while in the air.

Griffiths said he believed air travel, with passengers properly masked, remained safe. Anecdotal evidence cited in a Journal of Travel Medicine article published in September showed no passengers contracted the coronavirus on five Emirates eight-hour flights to Hong Kong despite having 58 passengers spread among the flights who tested positive on arrival.

“Travel and tourism and the ability of people to freely move about their business every day is actually something that would kick-start the economy,” Griffiths said. “And the key of that is the international travel and the use of aircraft has already been proven to be pretty much advanced in controlling the spread of the virus.”

For Dubai, the resumption of flights remains deeply in their business interest.

Emirates remains the linchpin of the wider empire known as “Dubai Inc.,” an interlocking series of businesses owned by the city-state. The Investment Corporation of Dubai, a sovereign wealth fund, owns Emirates in its entirety, as well as the lucrative Dubai Duty Free.

Those duty free sales in 2019 accounted for $2 billion in revenue, including over 15 million cigars and 2.9 million bottles of perfume. 

The corporation did not respond to a request for comment on 2020 sales, though its last financial report acknowledged “measures to contain the virus have resulted in temporary closure of the stores.”

Some duty free shops have reopened in parts of the airport in the time since. Dubai authorities also have given Emirates a $2 billion bailout while laying off thousands of staffers. 

As far as the airport, Griffiths said he “cannot rule out” the need to fire some of its over 2,000 employees if there’s a slow recovery.

Dubai reopened for tourists in July, even as neighboring Abu Dhabi still requires even UAE residents to have just-received virus test results to come into the emirate. There’s a noticeable uptick in flights in the air as Emirates offers touchless check-ins and other measures to woo travelers.

Still, Emirates’ iconic fleet of double-decker Airbus A380s largely has been grounded. At the start of the year, the world saw 2,400 flights by the aircraft a week — the majority of those by Emirates, according to the flight-tracking website FlightRadar24.com. At most now, there are just over 100 flights a week — the majority of them still flown by Emirates, the website said earlier this month.

“The thing is that what we’ve got to understand is that air travel will bounce back. We will get back to levels that we’ve seen before,” Griffiths said. 

“We just can’t say how long and when. And the 380 will once again come into its own once those volumes return.”


WEEKLY ENERGY RECAP: A mixed week for oil with investors regaining confidence

WEEKLY ENERGY RECAP: A mixed week for oil with investors regaining confidence
Updated 17 January 2021

WEEKLY ENERGY RECAP: A mixed week for oil with investors regaining confidence

WEEKLY ENERGY RECAP: A mixed week for oil with investors regaining confidence
  • For 2021, OPEC forecast global oil demand to increase by 5.9 million bpd

It was a very mixed week, with oil prices remaining relatively steady despite mixed bearish developments. The commodity market is seeing renewed confidence from investors who have pushed oil prices more than 40 percent since the end of October 2020 after a series of coronavirus vaccine breakthroughs, which raised expectations for a sustained recovery in oil consumption.

On the week closing, Brent crude price made the first weekly decline in three weeks when it fell to $55.10 per barrel. The WTI ended the week slightly up at $52.36 per barrel. The Brent crude weekly price drop came amid the highest increase in COVID-19 cases in China in more than 10 months, which have led to isolation measures and weighed on oil market sentiment.

This week bearish news came mostly from China (the largest oil importer) after its crude oil imports slumped to 9.1 million barrels per day (bpd) in December 2020, from 11.1 million bpd in November 2020. That is the lowest oil import level in 27 months.

The US is planning a stimulus package that some hope will revive its economy and help oil market recovery. The US Energy Information Administration (EIA) reported the latest US crude inventories were lower for the fifth straight week, dropping by 3.2 million barrels. The EIA also surprised the market with its pessimistic forecast for US crude oil production to average 11.1 million bpd in 2021, down by 200,000 bpd from the 2020 average production level.

On the other hand, the OPEC monthly oil market report gave an optimistic oil supply outlook for US shale oil in 2021. With oil prices increasing, OPEC expects oil output to recover more in the second half of 2021 but this is very unlikely to hamper OPEC+ efforts to rebalance if oil demand goes to pre-pandemic levels.

The OPEC monthly report shows total commercial oil stocks for the OECD were at 163.1 million barrels above the latest five-year average for November 2020, which is the latest available data.

OPEC left its forecast for world oil demand unchanged, which has declined by 9.8 million bpd to an average of 90 million bpd in 2020. For 2021, OPEC forecast global oil demand to increase by 5.9 million bpd to average 95 million bpd.

OPEC reported mixed results for global refining margins in December 2020, slightly improving in the US but weaker in Europe. The surge in crude oil prices weighed further on Asian refining economics after returning from the autumn peak maintenance season. That contributed to a slight rise in available spare capacity as it awaits the right economic incentives.

OPEC reported US refinery use rates increased in December 2020 to average 79.14 percent while European refinery use averaged 65.32 percent. In selected Asia countries — China, India, Japan, Singapore and South Korea — refinery use rates increased, averaging 89.83 percent in December, corresponding to a throughput of 25.52 million bpd.

• Faisal Faeq is an energy and oil marketing adviser. He was formerly with OPEC and Saudi Aramco. Twitter:@faisalfaeq