Leading Gulf airlines Emirates, Qatar Airways and Etihad Airways cut average round-trip ticket prices for flights originating from the UAE to other Middle East states and to India in January 2016, passing on savings made from lower jet fuel oil prices to passengers.

Ticket prices fell by an average of 17 per cent for flights to Middle East destinations and by 8 per cent to India when compare with January 2015.

Jet fuel is understood to account for 30-50 per cent of an airline’s annual operating costs. The lower ticket prices resulted mainly from the removal of fuel surcharges.

Average ticket prices to European destinations, however, increased by nearly 2 per cent, with only Qatar Airways dropping its average ticket price by 18.5 per cent, according to data provided by travel portal Cleartrip to local media. Emirates and Etihad hiked average ticket prices to Europe by 2.5 and 21.7 per cent respectively.

The increase in the average round-trip ticket price to European destinations resulted from growth in demand, which has outstripped seat supply, according to Cleartrip’s chief revenue officer, Amit Taneja.

”While oil prices dropped by nearly 70 per cent [since the second half of 2014], jet fuel prices did not drop as much… We can only drop ticket prices to a certain degree because we tend to take advantage of such situations to recover margins, which are usually low when oil prices are high,” said Akbar al-Baker, CEO of Qatar Airways, in a forum during the Bahrain International Airshow in late January.

Al-Baker added at the time that the carrier’s pricing strategy should strengthen the case that it is not being subsidised by the Qatari government.

The Gulf airlines have been involved in an extended Open Skies dispute with the US Big Three – American Airlines, Delta Air Lines and United Airlines – since early 2015. The American airlines have alleged that the three Gulf carriers received $42bn in subsidies from their home governments over a 10-year period, effectively violating the Open Skies agreement signed between the US and the UAE and Qatar governments.

The Gulf airlines strongly denied the allegations and presented counter-arguments to the US Transport Department, which is reviewing the case.