After the surge in oil prices, many Asian airlines collectively increased fuel surcharges, leading to a general rise in international ticket prices.

The Iran conflict has caused intense fluctuations in international oil prices, and the Asian airline industry is experiencing a new wave of collective fare increases. Low-cost carriers and full-service airlines have announced adjustments to fuel surcharges or ticket prices, with some airlines issuing flight suspension warnings. Travel costs are rapidly rising.

Qantas announced an average increase of about 5% in international ticket prices, noting that fuel prices have risen more than 150% over the past two weeks. Air India and Asian Airlines have also announced adjustment plans. Air India’s fuel surcharge for flights to Europe will increase by $25 to $125 starting March 18, while surcharges to North America and Australia will rise by $50 to $200.

The turmoil in the Middle East has also boosted demand for alternative routes, further driving up fares. According to flight data analysis firm Cirium Ltd, between February 28 and March 10, more than 43,000 flights to and from the Middle East were canceled. As a result, Qantas’ European routes this month have seen passenger loads exceed 90%, well above the usual 75%. Air New Zealand announced fare increases and also withdrew its profit guidance, stating that “the fuel cost assumptions announced at the end of last month are no longer applicable.”

Ajay Singh, founder of SpiceJet in India, warned that even if oil prices stay at $90 per barrel, it is “completely unsustainable” for airlines, and called on the government to reduce fuel taxes. He said that if high oil prices persist, SpiceJet is considering grounding some aircraft, and other airlines may be forced to reconsider expansion plans.

Details of surcharge adjustments by airlines

Several major Asian airlines have announced specific adjustment plans, with increases varying based on route distance.

Air India and its subsidiary Air India Express announced phased fuel surcharge increases starting March 12: domestic flights and those to South Asia, West Asia, and the Middle East will each add 399 rupees (about $4.35); surcharges to Southeast Asia will rise from $40 to $60; surcharges to Africa will increase from $60 to $90. Starting March 18, surcharges for European routes will increase by $25 to $125, and those to North America and Australia will rise by $50 to $200. Adjustments for flights to Hong Kong, Japan, and Korea will be announced separately.

Hong Kong Airlines will raise fuel surcharges on multiple routes from March 12, with surcharges to the Maldives, Nepal, and Bangladesh increasing by 35%, adding HKD 100 (about $12.80) per ticket; surcharges to long-haul destinations like Australia and North America will increase by HKD 150 to HKD 739.

Asian Airlines announced fare increases and fuel surcharge adjustments but did not disclose specific amounts, only stating they will “monitor market conditions dynamically and respond proactively when necessary.”

Industry warning signals intensify, with some airlines adopting a wait-and-see approach

Although many airlines have actively adjusted prices, Japan Airlines stated that while fuel surcharges are now being collected on international routes, there are no plans to adjust them early; current arrangements will remain until after April 1 before further review.

Industry pressure continues to mount. Ajay Singh of SpiceJet bluntly said that in a high oil price environment, airlines will have “no choice” but to pass fuel costs onto passengers, and called on the government to cut fuel taxes to ease industry pressure. If the conflict in the Middle East escalates further and fuel supplies face significant shortages, airlines across Asia could see further cost pressures, and their operational strategies and expansion plans will face greater uncertainty.

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