Oil prices have a significant impact on the airline industry. Due to recent developments in the oil markets, airlines have to employ non-monetary methods; techniques include hedging or airline alliances, in order to increase fuel-buying power. (Thompson and Gamble, 2012)
If the economic situation of the country is not good then it will affect the business of the airline, so it is necessary for the airline to get proper business regularly so that it works smoothly. If there is decline in the economic sector, then it will affect its business. If there is economic recession and the per capita income of people is also decreased, then the airline will face problems in operating its flights on domestic and international routes. The economic downturn will also affect the income of the airline and it has to stop different flights.