US airlines face heightened risks as global carriers bypass Middle East after attacks on Iran
US airlines face heightened risks as global carriers bypass Middle East after attacks on Iran
Follow our live coverage here.
An organisation that monitors flight risks warned on June 22 that US strikes on Iran's nuclear sites could heighten the threat to American operators in the region, as airlines continued to avoid large parts of the Middle East due to ongoing missile exchanges.
But following a barrage of early morning Iranian missiles, Israel has reopened its airspace for six hours on June 22 to bring back those stranded abroad since the conflict with Iran began on June 13.
Safe Airspace, a membership-based website run by Opsgroup, said the US attacks on Iran may increase risks to US operators in the region.
'While there have been no specific threats made against civil aviation, Iran has previously warned it would retaliate by attacking US military interests in the Middle East - either directly or via proxies such as Hezbollah,' Safe Airspace said.
Meanwhile, flight tracking website FlightRadar24, said airlines maintained flight diversions around the region.
'Following US attacks on Iranian nuclear facilities, commercial traffic in the region is operating as it has since new airspace restrictions were put into place last week,' it said on social media platform X.
Its website showed airlines were not flying in the airspace over Iran, Iraq, Syria and Israel. They have chosen other routings such as north via the Caspian Sea or south via Egypt and Saudi Arabia, even if these result in higher fuel and crew costs and longer flight times.
Missile and drone barrages in an expanding number of conflict zones globally represent a high risk to airline traffic.
Since Israel launched strikes on Iran on June 13, carriers have suspended flights to destinations in the affected countries, though there have been some evacuation flights from neighbouring nations and some bringing stranded Israelis home.
In the days before the US strikes, American Airlines suspended flights to Qatar and United Airlines did the same with flights to Dubai.
Safe Airspace said it was possible airspace risks could now extend to countries including Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. 'We continue to advise a high degree of caution at this time,' it said.
Israel's carriers, El Al Israel Airlines, Arkia, Israir and Air Haifa, said earlier on June 22 they had suspended rescue flights that allowed people to return to Israel until further notice.
El Al said it would also extend its cancellation of scheduled flights through Friday and Israir said it had halted the sale of tickets for all flights through July 7.
A spokesperson for Israel's airports authority said the country's main airport, Ben Gurion near Tel Aviv, was expected to reopen for rescue flight landings on Sunday between 11am and 5pm local time.
Flag carrier El Al, Arkia and Israir said some flights would resume at 11am local time. Air Haifa said it had cancelled four flights on June 22, although the Airports Authority said the small Haifa Airport serving Israel's north would also be open from 11am to 5pm local time.
Tens of thousands of Israelis and others who had booked tickets to Israel are stuck abroad.
At the same time, nearly 40,000 tourists in Israel are looking to leave the country, some of whom are going via Jordan's borders to Amman and Aqaba and others via Egypt and by boat to Cyprus.
'In accordance with security directives, we are working to bring Israelis home as quickly as possible,' Israel's Transport Minister Miri Regev said in a statement.
Japan's foreign ministry said on June 22 it had evacuated 21 people, including 16 Japanese nationals, from Iran overland to Azerbaijan. It said it was the second such evacuation since June 19 and that it would conduct further evacuations if necessary.
New Zealand's government said on June 22 it would send a Hercules military transport plane to the Middle East on standby to evacuate New Zealanders from the region.
It said in a statement that government personnel and a C-130J Hercules aircraft would leave Auckland on June 23. The plane would take some days to reach the region, it said.
The government was also in talks with commercial airlines to assess how they may be able to assist, it added. REUTERS
Join ST's Telegram channel and get the latest breaking news delivered to you.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
5 minutes ago
- Business Times
Why China holds the trump card in trade talks with the US
[SINGAPORE] The US and China have extended their trade truce to Nov 10, 2025, averting another round of sweeping tariff escalation. That means the existing tariff framework remains unchanged: The United States maintains a 30 per cent levy on Chinese imports, while China continues to impose a 10 per cent tariff on American goods. The US tone has shifted markedly in recent months. In April, China was the only major economy to confront Washington's tariff policies, engaging in tit-for-tat retaliation that pushed levies above 100 per cent. By August, while the US imposed new tariffs on other trading partners, China received a temporary reprieve, with the tariff pause extended to allow more time for negotiations. The most significant contrast is with India, which faces a renewed 50 per cent tariff over its purchases of Russian oil and weapons, an outcome that China has so far avoided, despite also sourcing oil from Russia. Why is US President Donald Trump taking a softer approach with Beijing? Rare earths: China's biggest strategic leverage China's dominance in rare earth materials remains a pivotal bargaining chip in the ongoing trade stand-off. The country is estimated to mine 60 to 70 per cent of the world's rare earths and refine roughly 90 per cent of them. Following talks in Geneva, China eased some controls, raising rare earth shipments to the US from a mere 46 tonnes in May to 353 tonnes in June. Despite the increase, volumes remain well below historical averages. Any renewed escalation in trade tensions could see Beijing reinstate stricter export curbs, posing significant risks to US sectors that are reliant on rare earths, including defence, aerospace, automotive and electronics. Rare earths are not China's only lever. Agricultural trade has also been sharply curtailed. Soybean imports from the US fell to US$2.5 billion in the first six months of 2025, a 51 per cent decline from US$5.1 billion in the same period last year. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Purchases of corn, cotton and beef have also been scaled back. This strategy highlights China's weight as a major global consumer of commodities and signals its readiness to apply pressure in areas where US producers remain highly exposed. Washington has also dialled back some of its own restrictions. The Trump administration reversed its earlier ban on Nvidia's H20 chips, approving shipments of both H20 and AMD's MI308 processors. The approvals came with a condition, namely an agreement for chipmakers to share 15 per cent of their China sales revenue, though Beijing has denied that this concession forms part of the trade accord. While the latest extension buys both sides breathing space, the truce remains fragile. Several contentious issues are still on the table for the second phase of negotiations: US demands on fentanyl trafficking; concerns over Chinese imports of sanctioned Russian and Iranian oil; and efforts to narrow the US trade deficit, including calls for China to treble soybean purchases. Beijing is pressing for a rollback of targeted technology restrictions, and protection for Chinese firms from future sanctions. Given the complexity of bridging divergent objectives, progress in the negotiations is expected to remain slow, and it would not be surprising to see talks continue right up to the next deadline. Washington faces the delicate task of pursuing its strategic goals without jeopardising access to critical rare earth supplies. With Beijing having the upper hand in this area, the US is unlikely to impose sweeping new tariffs on China without careful consideration. China set for stronger H2 With the immediate tariff threat postponed, China's economy is set to hold up better in the second half of 2025. The easing of trade pressure is providing vital support for exports, allowing manufacturers to capitalise on the fragile truce to ramp up shipments. In July, exports grew 7.2 per cent year on year, the fastest pace since April. While shipments to the US continued to contract by 21.7 per cent, demand from other Asia-Pacific markets surged; exports to Taiwan rose 19.2 per cent, to Asean by 16 per cent, and to Australia by 14.8 per cent. The truce extension gives manufacturers more time to build inventories of key materials and capture additional orders before policy reversal. Recognising that trade risks are far from eliminated, Beijing is maintaining a strong focus on domestic consumption. Retail sales rose 4.8 per cent year on year in the first seven months of 2025, and the 618 mid-year shopping festival saw e-commerce sales jump 15.2 per cent from a year earlier, reversing 2024's decline, according to retail data provider Syntun. The government has earmarked 138 billion yuan (S$24.7 billion) in consumer subsidies for H2 2025, alongside increased support for the services sector through consumption-linked loans aimed at helping businesses upgrade infrastructure and expand hiring. Subsidies have boosted discretionary spending, but appetite for big-ticket items such as housing remains subdued. New home sales among China's top 100 developers recorded double-digit declines in June and July. Yet early signs of stabilisation are emerging, with housing prices in major cities such as Shanghai rebounding and total inventory gradually declining. A strong case for investment While trade risks remain, Beijing's command of rare earths provides a crucial layer of negotiating leverage, ensuring that it remains well-positioned to navigate future tensions. With sweeping US tariffs temporarily on hold until November, China's growth outlook for 2025 has turned more constructive. The economy is entering a new phase, pivoting towards targeted consumption incentives and pro-growth measures designed to revive private-sector confidence. The next leg of expansion will be anchored by more domestically driven, resilient technology sectors – areas less exposed to the ebb and flow of trade frictions – offering investors greater clarity on the market's medium-term trajectory. For investors seeking portfolio diversification, China's combination of steady growth momentum, policy tailwinds and attractive valuations presents meaningful upside potential, making it a market worth keeping on the radar in 2025 and beyond. The writer is a research analyst with the research and portfolio management team of the B2C division of iFast Financial, the Singapore subsidiary of iFast Corp
Business Times
2 hours ago
- Business Times
Trump tariffs get seal of approval as S&P affirms credit rating
[WASHINGTON] US President Donald Trump's sweeping tariffs have roiled markets, unnerved trade partners and provoked criticism from leading economists. But there is an upside: The levies will help the US maintain its fiscal health, according to S&P Global Ratings. The credit rating company has affirmed its AA+ long-term rating for the US, in part because it thinks tariff revenues will reduce the fiscal hit of a recent tax and spending Bill. It kept the outlook for the long-term rating stable. The decision offers a glimmer of good news for Trump, who has pushed back against arguments that his historic programme of tariffs will damage the US economy. Although the S&P analysts did not contradict that view, they stressed that as Trump embarks on a bold programme of tax cuts and spending, tariffs will help soften the blow. 'Amid the rise in effective tariff rates, we expect meaningful tariff revenue to generally offset weaker fiscal outcomes that might otherwise be associated with the recent fiscal legislation, which contains both cuts and increases in tax and spending,' wrote analysts including Lisa Schineller in a note. S&P's views matter for investors in the world's biggest bond market, which has been plagued by persistent questions over the fiscal deficit and debt sustainability. Yields on 30-year Treasuries jumped above 5 per cent in May as tariff fears and Trump's multi-trillion US dollar tax bill roiled global markets. Buy America Whether tariffs will give the US a meaningful revenue boost is a subject of debate among economists, who point to an apparent contradiction at the heart of Trump's approach: Tariff revenues rely on trade, but Trump has also attempted to pull production back to the US and encourage consumers to buy American-made products – moves that would undercut future levy receipts. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The White House did not immediately reply to an out of hours request for comment. So far, the numbers are strong. Tariff revenue reached a fresh monthly record in July, with customs duties climbing to US$28 billion. Treasury Secretary Scott Bessent said tariff revenues for all of 2025 could be 'well in excess of 1 per cent of GDP,' revising his previous estimate of US$300 billion. But the bipartisan Congressional Budget Office estimates the recently passed budget bill will add US$3.4 trillion to the deficit over the next 10 years. US 30-year yields were close to flat around 4.94 per cent in Asia trading on Tuesday (Aug 19), while those on benchmark 10-year yields edged higher to 4.34 per cent. That pointed to a muted short-term impact from the S&P report, even if it adds an important voice as traders weigh up the impact of tariffs over the coming months. 'These are still small nuances close to the top of the credit ratings hierarchy and it doesn't signal any material change in the US fiscal health, which is a complex issue,' said Homin Lee, senior macro strategist at Lombard Odier in Singapore. 'The pressures on the Fed to again consider defying rates markets and hold next month just received a (rather modest) boost as S&P Global Ratings delivered a solid report card for the US's economy and outlook.' said Garfield Reynolds, MLIV team leader. The US lost its last top rating from the big three credit companies in May, when Moody's Ratings lowered the country from Aaa to Aa1. It blamed successive administrations and Congress for swelling budget deficits that it said show little sign of abating. Fitch Ratings and S&P had previously downgraded the US from AAA. S&P said the stable outlook indicates its expectation that while the fiscal deficit won't meaningfully improve, it also won't persistently deteriorate over the next several years. The agency expects net general government debt to surpass 100 per cent of GDP over the next three years, but it thinks the general government deficit will average 6 per cent from 2025 to 2028, down from 7.5 per cent last year. The rating affirmation could be a positive for the US dollar after Trump's tax and spending bill cast doubts on the sustainability of US debt, said Fiona Lim, a senior currency strategist at Malayan Banking Bhd. Still, the more lasting driver for the greenback will come from Federal Reserve minutes, as well as Fed chair Jerome Powell's speech in Jackson Hole on Friday, she said. A gauge of the US dollar edged higher during Asia trading hours on Tuesday. BLOOMBERG
Straits Times
3 hours ago
- Straits Times
Trump tariffs get seal of approval as S&P affirms US credit rating
Singapore - US President Donald Trump's sweeping tariffs have roiled markets, unnerved trade partners and provoked criticism from leading economists. But there is an upside: The levies will help the United States maintain its fiscal health, according to S&P Global Ratings. The credit rating company has affirmed its AA+ long-term rating for the US, in part because it thinks tariff revenues will reduce the fiscal hit of a recent tax and spending bill. It kept the outlook for the long-term rating stable. The decision offers a glimmer of good news for Mr Trump, who has pushed back against arguments that his historic programme of tariffs will damage the US economy. Although the S&P analysts didn't contradict that view, they stressed that as Mr Trump embarks on a bold programme of tax cuts and spending, tariffs will help soften the blow. 'Amid the rise in effective tariff rates, we expect meaningful tariff revenue to generally offset weaker fiscal outcomes that might otherwise be associated with the recent fiscal legislation, which contains both cuts and increases in tax and spending,' wrote analysts in a note. S&P's views matter for investors in the world's biggest bond market, which has been plagued by persistent questions over the fiscal deficit and debt sustainability. Yields on 30-year Treasuries jumped above 5 per cent in May as tariff fears and Mr Trump's multi-trillion dollar tax bill roiled global markets. Buy America Whether tariffs will give the US a meaningful revenue boost is a subject of debate among economists, who point to an apparent contradiction at the heart of Mr Trump's approach: Tariff revenues rely on trade, but Trump has also attempted to pull production back to the US and encourage consumers to buy American-made products – moves that would undercut future levy receipts. So far, the numbers are strong. Tariff revenue reached a fresh monthly record in July, with customs duties climbing to US$28 billion (S$36 billion). US Treasury Secretary Scott Bessent said tariff revenues for all of 2025 could be 'well in excess of 1 per cent of GDP,' revising his previous estimate of US$300 billion. But the bipartisan Congressional Budget Office estimates the recently passed budget bill will add US$3.4 trillion to the deficit over the next 10 years. Top stories Swipe. Select. Stay informed. Singapore Two China Eastern Airlines planes involved in runway incursion at Changi Airport in Aug 2024 Life Local indie theatre The Projector to cease operations on Aug 19 after a decade Singapore 'I vaped when I woke up until I slept': More youth vaping to cope with stress, say social workers Asia Singaporean man sentenced to 72 years' jail in Malaysia for murdering wife and stepson Singapore 4 days' jail for former pre-school teacher who kicked and bruised pupil's shin Life Disrupted sleep, steroid psychosis: How chronic sinus condition affected one S'pore hawker's life World Trump's art of the 'peace' deal for Ukraine and Russia US 30-year yields were close to flat around 4.94 per cent in Asia trading on Aug 19, while those on benchmark 10-year yields edged higher to 4.34 per cent. That pointed to a muted short-term impact from the S&P report, even if it adds an important voice as traders weigh up the impact of tariffs over the coming months. 'These are still small nuances close to the top of the credit ratings hierarchy and it doesn't signal any material change in the US fiscal health, which is a complex issue,' said Homin Lee, senior macro strategist at Lombard Odier in Singapore. The US lost its last top rating from the big three credit companies in May, when Moody's Ratings lowered the country from Aaa to Aa1. It blamed successive administrations and Congress for swelling budget deficits that it said show little sign of abating. Fitch Ratings and S&P had previously downgraded the US from AAA. S&P said the stable outlook indicates its expectation that while the fiscal deficit won't meaningfully improve, it also won't persistently deteriorate over the next several years. The agency expects net general government debt to surpass 100 per cent of GDP over the next three years, but it thinks the general government deficit will average 6 per cent from 2025 to 2028, down from 7.5 per cent ion 2024. The rating affirmation could be a positive for the US dollar after Trump's tax and spending bill cast doubts on the sustainability of US debt, said Fiona Lim, a senior currency strategist at Malayan Banking. Still, the more lasting driver for the greenback will come from Federal Reserve minutes, as well as Fed chair Jerome Powell's speech in Jackson Hole on Aug 22, she said. A gauge of the dollar edged higher during Asia trading hours on Aug 19. BLOOMBERG
