Qatar Airways: Caught in a political crisis

By Bjorn Fehrm 

June 07, 2017, ©. Leeham Co: We wrote about Qatar Airways last week, the flag carrier of Qatar. One week later, the airline finds itself caught in a political crossfire.

The background to the crisis is complicated. At the root is a longtime feud in the area. To aid in understanding what is happening, we reference some background information and look at possible consequences for Qatar Airways.

The Gulf crisis

The political crisis triggered Monday. Saudi Arabia, United Arab Emirates, Bahrain, Yemen and Egypt cut diplomatic relations with Qatar and blocked the country from flying through their airspace and to their airports (Figure 1). Qatar was also blocked from its only land access by Saudi Arabia. The official explanation is that Qatar is supporting terrorism.

Figure 1. Qatar surrounded by blocking countries. Source: Google maps. Click to see better.

The longer explanation is a bit more involved. Read about the background here (BBC article by Dr. David Roberts, King’s College London, a Gulf area specialist) with this article describing the wider effects of the crisis.

Effects on the air traffic in the area.

The direct effect is that traffic from the blocking countries’ airlines to or through Qatar’s Hamad International airport has stopped. As have Qatar Airways flights to the blocking countries. To fly to Qatar from a blocking country you have to book a flight through Kuwait, Iran, Oman or any other non blocking country, and then change to a non blocking airline that flies to Qatar.

Effects on Qatar Airways

The effects on Qatar Airways depends on how long the crisis will last. As stated in the BBC article by Dr. Roberts, Qatar’s position this time is weak, compared with the similar crisis in 2014 when it was stronger. This could mean a diplomatic solution could be found soon.

If not, it will be tough for Qatar and its airline. Looking at the Qatar Airways destination map (Figure 2), it’s clear about half of its international destinations will have a longer flight path to handle.

Figure 2. Qatar 2016 network with 150 destinations. Source: Qatar Airways. Click to see better.

Further, any flights on a Qatar Airways aircraft to one of the blocking countries will not fly. Flights from boycotting country airlines to Qatar will not fly as well. Qatar Airways can only operate local routes to Kuwait, Iran and Oman.

The Oneworld alliance flights with destination Doha will work, as will all transiting traffic to other non-blocking country airports. The effects on Oneworld flights with non Qatar Airways planes to blocking countries, which code-share with Qatar Airways, is not clear. Some third party airlines which transit through Qatar to a blocking country have stopped flights.

A more long term effect will be that passengers will shy away from booking with Qatar Airways. This is the strongest accusation to date of Qatar being connected with terrorism. Many travelers and corporate accounts could blacklist Qatar Airways.

Effects on Qatar Airways’ fleet plan

Qatar Airways has an ambitious expansion plan for its fleet, Figure 3. The airline is accepting 16 Airbus A350-900 and three A350-1000 during 2017, out of an order for 80 aircraft in total (19 A350-900 delivered so far). Should the crisis drag on, one can expect deferrals of future deliveries.

Figure 3. ATDB Qatar Airways fleet timeline. For the interactive version click here. Source: Aerotransport Data Bank.

Boeing has delivered 30 787-8 over the last years. There are no more on order, but 787-9 deliveries shall begin next year. Three shall be delivered 2018, followed by 22 during 2019. Once again, if the crisis drags on, these deliveries can be affected.

Qatar has also ordered 50 777-9 and 10 777-8. These deliveries start 2021, too far out to be affected by the present crisis.

14 Comments on “Qatar Airways: Caught in a political crisis

  1. Because of airspace limitations over Iraq and Syria, even flights from Dubai will go north along the Iraq- Iran border before heading for Northern Europe, so its seems not many problems for Qatar there. Flights to Africa seem to be skirting around the straights of Hormuz area before heading over Omani territory to African destinations. Similar for flights to Sub continent- South East Asia and Australia.
    Regarding the main story, there have been reports the FBI has confirmed that the news story that Saudi Arabia has complained about was fake and planted by Russia?
    The other significant Qatari asset that has got under other arab countries skins is the TV channel Al Jazerra.

    • While Qatar may indeed have been the source of funding for many violent islamist groups, I would be very careful about making this a good guy versus bad guy story. All but two of the 9/11 hijackers were from Saudi Arabia and UAE – the “good” guys in this dispute.

      • I agree. Its really about their failure to be in total opposition to Iran that has been behind this.

      • Technically many were from Yemen, which has alternated between being part of Saudi Arabia and being independent. So some people travelling on Saudi passports were born in Yemen, as IIRC bin Laden was (Saudi yanked his citizenship due behavior.)

        Rich Saudis have been accused of funding Islamic Totalitarian terrorist warriors.

  2. given that the US’s largest military installation in the Persian Gulf region is _in_ Qatar, it strikes me as a bit unwise (/understatement) for our president to be giggling on twitter and taking credit for this.

    every government over there sponsors or at a minimum looks the other way regarding the activities or their pet extremist groups (as does the US & Israel).

    pot, meet kettle.

  3. Note that this immediately followed the demand by Trump in Riyadh that the Arab states stop supporting terrorism: Naturally, not being innocents, the Saudi’s, determined not to stop supporting terrorists in Syria, instead picked on a weak local target that had exercised the temerity of critiquing the Kingdom. I believe the only documented support for terrorist groups by Qatar is of Hamas – its support for the Brotherhood is for exile only – but in any case any facts in the matter have been submerged by what seems to have been another successful Russian data hacking and false news exercise.

    Back on topic – the key here is how united Saudi Arabia and the Emirates will be on the issue (Bahrein and Egypt are largely irrelevant in terms of air transit) and whether or not Saudi Arabia puts pressure on Syria/Lebanon to block transits. My suspicion is that the latter is unlikely, while the wild card here is if Iran instead offers transit rights.

  4. Time for the al Thani clan in Qatar to “get in line”, or see two brigades of tanks–Saudi and Bahraini–on the horizon approaching their borders!

    • Hmm, in the army of Saudi Arabia there’s apparantly a lot of “good quality hardware” in unskilful hands. That’s probably why Saudi Arabia has been using the federal armed forces of the US as their own personal mercenary force, time and again.

      • No comment on the Bahrainis? With 150 + tanks, 250 + IFVs, and 9 MRLVs, I’d say it’s more than even money Doha, and the airport, could be reduced to rubble in < 24 hours.

        • Since the majority of the population along the Gulf coast, Bahrain included is expat with the locals Shia, Iran might not be the only country having something to say about that.
          Shock and awe is good for the keyboard warriors but isnt a viable stategy

    • Attacking Qatar with them having the biggest US millitary base in the middle east. Very unlikely ! Would love to see US reaction if that happen. Maybe the saudi could confiscate the US millatary asset while the take control of Qatar !

  5. I am a bit surprised none of our usual pundits are talking about the opportunity this move affords Emirates and to some extent Etihad as Qatar will be seriously damaged by this move if it lasts.

    The ‘big’ MEA3 could be reduced to MEA2.

    Of course, this being that region, history shows they could be in bed together again (the governments) tomorrow with full show of ‘eternal brotherly love’. (crocodile) Tears included.

    But if it lasts, Qatar will be quite seriously damaged. Just the move to bar **any** tanker that makes Qatar port calls from anchoring in the UAE and Saudi **indefinitely** in the future is just deadly economically.

    (ps: i have a local ethnic arab friend who is running a substantial VC fund out of there and that firm is quite panicked. The damage is real. It’s rearranging all sorts of future planning, ie: halt!!).

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