The S&P/ASX 200 Index (ASX: XJO) travel shares are having a day of strong gains.
There has been a lot of volatility amid the Russian invasion of Ukraine, with the impacts of the conflict being felt far and wide. One of the impacts has been an oil price which has charged higher. ASX 200 travel shares have seen difficulties with investor sentiment over the last few weeks.
But today, many ASX 200 travel shares are reversing some of those declines.
Let's look at those movements.
ASX 200 travel share gains
The Qantas Airways Limited (ASX: QAN) share price is up by 6.4% at the time of writing. That means since the start of the year, the airline's shares are only down by 3.7%.
Next is the Webjet Limited (ASX: WEB) share price which is currently up by 6.8%. The digital travel agency business has now seen its shares rise by close to 5% this calendar year.
The Corporate Travel Management Ltd (ASX: CTD) share price has gone up by 5.6%. It is now only down by 2.6% in 2022.
The Flight Centre Travel Group Ltd (ASX: FLT) share price has also soared higher – it has flown higher by 8.4%. It's now up just over 3% for the 2022 year.
What is driving these gains?
It has been widely reported that oil prices have sunk. Oil prices were down as much as 17% earlier.
The United Arab Emirates (UAE) stated that it supports increasing production. This is in response to the much higher oil price because of supply disruptions caused by the Russian invasion. Russia is responsible for supplying 7% of global oil. The USA and Canada have banned Russian oil imports, whilst the UK will phase it out over this year.
UAE ambassador Yousuf Al Otaiba said:
We favour production increases and will be encouraging OPEC to consider higher production levels.
The UAE has been a reliable and responsible supplier of energy to global markets for more than 50 years and believes that stability in energy markets is critical to the global economy.
What next for ASX 200 travel shares?
The ASX 200 travel industry continues to face some disruption from COVID-19 impacts, though travel volumes are returning according to some of the ASX shares like Corporate Travel Management and Webjet.
Whilst oil prices have fallen, it is still substantially higher than before the Russian invasion of Ukraine. Time will tell what happens next – commodity prices are not known to be predictable.
