War in the Middle East: AirAsia, China Airlines… several Asian airlines increase their prices

This is a logical consequence of the war in the Middle East and the rise in fuel prices. Several Asian airlines have recently announced the increase in ticket prices.

Many international airlines have increased their fuel surcharges since the start of the conflict and the almost complete closure of the Strait of Hormuz, a crucial artery for global hydrocarbon supplies. By the end of March, the average price of jet fuel had risen globally to US$197 per barrel last week, from US$95.5 a month ago, according to data from the International Air Transport Association (IATA).

Up to 40% increase for AirAsia

The latest, Southeast Asia’s largest low-cost airline, AirAsia, announced on Monday that it would increase the price of its tickets by up to 40% and reduce its routes in order to cushion the effect of the war in the Middle East, while stressing that demand for flights remains strong.

The Malaysia-based low-cost airline told reporters that around 10% of all its flights had been canceled to date. AirAsia, which serves more than 150 destinations in 25 countries, is able to spread its operations across routes “where we can recover high fuel surcharges,” said the group’s commercial director, Amanda Woo.

Ticket prices have increased by around “31 to 40%”, she said, while fuel surcharges have been increased by 20%. The other planned routes are still on track, including flights to Bahrain, the company’s first hub in the Middle East and a key stage in the extension of its network beyond Southeast Asia, which is scheduled to launch in June.

AirAsia founder Tony Fernandes said rising prices, even in the low-cost sector, were “inevitable” and that capacity would be reduced on routes “where we don’t think we can cover the cost of fuel”. The company has also taken a number of steps to try to limit price increases as much as possible, including reducing baggage fees, Amanda Woo added.

China Airlines et Eva Air

Already last week, Taiwanese airlines announced a 157% increase in their fuel surcharge on international flights. Supplements on short flights will increase by 23.86 euros and long-haul flights will see their supplement jump by 62.03 euros, the Civil Aviation Administration (CAA) indicated.

China Airlines and Eva Air had specified that these increases would apply from April 7. Domestic flights are also affected, with an increase in ticket prices of around 2.60 euros on average.

Air China, Spring Airline, China Southern…

Several Chinese airlines, including national carrier Air China, have announced they will increase fuel surcharges on domestic flights.

Air China, Spring Airlines as well as China Southern and its subsidiary Xiamen Air will increase surcharges by 60 yuan (7.55 euros) on flights up to 800 km and by 120 yuan (around 15 euros) on longer flights, the companies said in a press release published mid-last week.

Up to 13% increase in Indonesia

Indonesia, for its part, announced this Monday a 28% increase in the fuel surcharge and authorized airlines to practice up to 13% price increases on domestic airlines, the price of which is regulated, indicated its Minister of Economy Airlangga Hartarto. The latter told journalists that the fuel surcharge would increase from 10 to 38% and that the base price of the ticket would see a price increase of 9 to 13%.

At Jakarta’s Soekarno-Hatta International Airport, the price of kerosene for domestic flights has increased by more than 70 percent since March, according to the website of national oil company Pertamina. For international flights, the price has almost doubled.