With jet fuel prices skyrocketing in recent days due to the escalation of the war in the Middle East, and airlines struggling to cope with the sudden and increasing cost, the solution, it seems, is to raise airfare prices. Tickets, which cost a few hundred euros until a few days ago, are now selling in high four-digit numbers!!!
Australian airline Qantas Airways and Air New Zealand announced on Tuesday that they are increasing ticket prices due to the Middle East conflict, saying they have no choice but to deal with the rising cost of fuel.
Fuel prices for airplanes, which were around $85 to $90 per barrel before the war, have increased sharply to levels between $150 and $200 per barrel in recent days, the national carrier of New Zealand reported, as it suspended its financial projections for 2026 due to the uncertain environment created after the start of hostilities between the US-Israel and Iran.
War has driven up oil prices and skyrocketed airfare on certain routes, sparking fears of a deep dive in travel and the possibility of widespread grounding of aircraft.
Emphasizing the chaos around Middle Eastern airspace, planes arriving in Dubai were put on hold briefly on Tuesday morning (10.03.26) due to a possible missile attack, as reported by the flight tracking service Flightradar24 on X.
Qantas, as Reuters reports, is exploring options for redistributing capacity in Europe as airlines and passengers avoid the Middle East region, as part of developments that include increasing airfares for international flights.
According to the Australian airline, its flights to Europe are over 90% full in March, compared to the usual 75% this time of year.
Flight tickets have increased on Asia-Europe routes due to the closure of airspace and capacity restrictions, with Hong Kong’s Cathay Pacific Airways today saying it will add extra flights to London and Zurich in March.
Air New Zealand reported that it increased economy class fares by NZ$10 (US$6) for one-way domestic flights, NZ$20 for short-haul international flights, and NZ$90 for long-haul flights, with further changes in pricing, network, and schedule planned if fuel costs remain at this high level.
Meanwhile, Hong Kong Airlines announced on its website that it will increase fuel surcharges by up to 35.2% starting Thursday, with the steepest increase being on flights between Hong Kong and Maldives, Bangladesh, and Nepal, where the charges will rise to 384 Hong Kong dollars (49 USD) from 284 Hong Kong dollars.
Cathay Pacific, for its part, said it had reviewed its fuel surcharges on a monthly basis, which it had kept at a stable level last month at $72.90 per leg on flights between Hong Kong and Europe and North America, before the conflict began.
Meanwhile, Vietnam Airlines has asked local authorities to abolish an environmental tax on aircraft fuel, helping it maintain its operations. The Southeast Asian government stated that the operating costs of Vietnamese airlines have increased by 60% to 70% due to the increase in fuel prices, and fuel suppliers are facing difficulties in meeting the demand of airlines.
Airline stocks on a stabilization course
In a move that boosted the stocks of some airlines, US President Donald Trump said on Monday that the war could end soon, a statement that caused oil prices to drop to about $90 a barrel today from yesterday’s high of $119.
In Asia, airline stocks showed signs of stabilization, with Qantas up 0.5%, Korean Air Lines up nearly 9%, and Cathay Pacific up more than 4%. All of them had recorded sharp drops on Monday.
Fuel is the second-largest expense for airlines, after personnel costs, typically accounting for one-fifth to one-quarter of operating expenses. Some large Asian and European airlines have instituted oil price risk hedging measures, but US airlines have not followed this practice in the last two decades.
Consequences for the travel industry
High fuel prices could have a significant impact on the global travel industry, as airlines are already navigating a limited airspace to avoid the conflict zone in the Middle East, and capacity on popular routes is filling up.
Combined, Emirates, Qatar Airways, and Etihad carry about one-third of passengers from Europe to Asia and more than half of passengers from Europe to Australia, New Zealand, and the nearby Pacific Islands, according to Cirium.
HanaTour Service of South Korea announced that it is canceling group tours that include flights to the Middle East and waiving cancellation fees for affected customers.
In Thailand, the Ministry of Tourism predicted that if the war continues for more than eight weeks, the country will lose a total of 595,974 tourists and 40.9 billion baht (1.29 billion USD) in tourism revenue.
