ASX travel shares are handily outpacing the benchmark index today.
And that’s on a day that’s seen the S&P/ASX 200 Index (ASX: XJO) charge 1% higher by lunchtime.
The Qantas Airways Limited (ASX: QAN) share price, however, has gained 3 times more, currently up just over 3%.
Among the smaller ASX travel shares, Helloworld Travel Ltd (ASX: HLO) has gained 3.5% so far in intraday trading.
Why are ASX travel shares taking off today?
There look to be a number of factors helping buoy ASX travel shares today.
First, momentum is building across the world to remove travel restrictions put in place 2 long years ago to mitigate the impacts of COVID-19.
New Zealand, a very popular destination for Aussies (and vice versa), announced that commencing 13 April, vaccinated arrivals from Australia will be able to enter without having to isolate. New Zealand intends to open its doors to a long list of other nations in early May.
On the far side of the world, the United Kingdom – another popular 2-way travel route from down under – is also helping boost travel sentiment. The UK is set to scrap its last COVID travel restrictions this week. Arrivals will no longer need to be tested.
What’s happening down under?
Australia is taking its own big steps in ending pandemic border restrictions, helping lift investor sentiment for ASX travel shares. Among the most recent moves, the Aussie government is ending its ban on international cruise ship arrivals as of 17 April.
Commenting on the end of the cruise ship embargo, Helloworld CEO, Andrew Burnes said:
This has been a long time coming and agents and their clients across Australia are both relieved and thrilled that this ban is finally coming to an end. The lifting of this ban will make a material difference to the sales of our agents and of Helloworld’s leisure travel divisions, both retail and wholesale.
The Federal Government has indicated the final decision on opening ports rests with each State Government and we look forward to that occurring as soon as possible.
Lower energy prices good news for ASX travel shares
Atop the lifting of COVID travel restrictions, another big factor that’s helping boost ASX travel shares is a retreat in crude oil prices.
With jet fuel counting amongst the biggest single costs for airlines, today’s US$101 per barrel Brent crude is a lot more palatable than the US$129 per barrel that Brent crude was trading for on 8 March.