British Airways and Air France have suspended Iran service



Two major European airlines said Thursday that they would suspend the service to Tehran next month, a double blow that underlined the power of new US sanctions against Iran and the limited ability of others to bypass them.

The suspensions, by British Airways and Air France, mean that at least three major European airlines, which once promised a lot for their Iranian activities under the now threatened nuclear deal, will stop flying to and from the country in September. KLM, the Dutch sister company of Air France, announced a similar suspension last month.

The movements seemed to deepen Iran's sense of economic isolation, which has worsened significantly in the nearly four months since President Trump deliberately negotiated US participation in the nuclear agreement by the government of his predecessor Barack Obama.

Mr. Trump and his assistants have warned foreign companies to avoid Iran in order to prevent US sanctions from being re-applied, which will be fully effective in November.

"Drastically reducing direct flights to Europe certainly has a psychological and economic impact," said Richard Aboulafia, vice president of analysis at Teal Group, an aerospace and defense industry consultancy in Fairfax, Virginia.

Both British Airways and Air France attributed their decisions to a fall in demand that made Iran's routes unprofitable, and they called the effects of Mr. Not Trump. But according to industry analysts, the primary cause was clear.

"There is no doubt that the economic sanctions imposed on Iran have an impact on the economy and the ability of some companies to do business there," says Henry Harteveld, founder of Atmosphere Research Group, an analysis company for the travel industry in San Francisco. "So I am sure that there is a strong decline in traffic, coming from Iran as well as traffic from Europe and other international points, including the US, that enter Iran."

Mr Harteveld said that an increase in the price of aviation fuel may also have played a role. "Jet fuel is like a strict parent," he said. "It forces you as an airline a lot of discipline and routes that are marginal, are often reduced or cut if they do not meet the profit expectations."

British Airways said that its last return flight between London and Tehran would be September 22-23. In a statement, the airline apologized for "any disruption this could cause for our customers' travel plans" and said it was arranging rebooking or refunds.

Air France said it "decided to prematurely end the summer season service from Paris to Tehran" as of 17 September, "due to weak economic performance." It offered customers conversion options.

Other foreign airlines still offer service to Iran. But the sailings of British Airways and Air France will reduce travel opportunities, as Britain and France try to save the 2015 core agreement, which was intended to end Iran's economic isolation in exchange for its verifiable promises of peaceful nuclear development.

"The news that British Airways and Air France stop flying to Iran is a prestigious blow to the government," said Cliff Kupchan, chairman of the Eurasia Group, a political risk consulting firm in Washington. "Major airlines from two countries that support the nuclear agreement no longer serve in Tehran."

Official media from Iran seemed to play down the suspension of the airline. But Press TV, a state-run news website, quoted the Iranian Ambassador to Britain, Hamid Baeidinejad, who said there was a big demand for travel to Iran and that the decision of British Airways was "regrettable".

Mr Trump, who described the nuclear agreement as a disaster, although most countries, including the European allies of the United States, have said that it worked, announced in May that the United States was withdrawing from the agreement.

The Trump government has since begun to reintroduce US sanctions against Iran, including severe restrictions on the Iranian banking system, automation and – most importantly – the sale of oil, the essential export of Iran.

Among the sanctions that have been reintroduced, companies that do business with Iran are risking sanctions on the much larger US market, which has intimidated large multinational corporations depending on their ties with the United States. Many have withdrawn from Iran or have suspended their plans to invest there.

The impact has weakened the Iranian currency, the rial, which has made imports in Iran and made them much more expensive for Iranians.

"The market is punishing Iran," Kupchan said, "what better or worse is exactly what Trump wants."


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