Airlines raise fuel surcharges again as jet fuel prices climb
India's IndiGo raised fuel charges on new bookings starting Tuesday, its third increase this year, after jet fuel prices jumped more than 14% in a month. Korean Air's October surcharges are up nearly 40% in two months on flights to the U.S. Travelers flying overseas are paying more as airlines pass on costs.
Flying overseas is getting more expensive, and fuel is the reason. Airlines in Asia are raising the fuel surcharges they add to tickets as jet fuel prices climb again.
India's largest airline, IndiGo, raised its fuel charges for new bookings made from Tuesday, the Indian Express reported. It is the airline's third increase this year. IndiGo said jet fuel prices rose more than 14% in the latest month, pushing costs to "amongst the highest in the last decade."
On domestic routes, IndiGo's charges now run from 375 rupees, about $4, to 1,300 rupees, about $14, per flight. On international routes, charges reach 10,000 rupees, about $104, for flights to Europe, Skift reported. IndiGo called the increase a "measured and relatively modest adjustment" and said a much larger hike would have been needed to cover the full rise in fuel costs. Tickets already booked are not affected.
The airline is feeling the squeeze. It posted a net loss of about $24.5 million in the June quarter, compared with a profit of about $225 million a year earlier, Skift reported. Fuel makes up more than 40% of an airline's operating costs, according to the Indian Express.
In South Korea, Korean Air's fuel surcharge for tickets issued in October rose to level 23 from level 21, Korea JoongAng Daily reported. On long flights from Incheon to U.S. cities including New York, Dallas, Chicago and Atlanta, the one-way surcharge is now 362,600 won, about $265. That is up nearly 40% since August. For a family of four flying round trip, fuel surcharges alone top 2.9 million won.
Korean Air bases its surcharge on the price of jet fuel in Singapore. That price averaged $158.57 a barrel in the period used to set October's charge, up 6.2% from the month before.
Some background: Fuel surcharges have swung with oil prices this year. Korean Air's surcharge hit its maximum level in May, fell through August and then began rising again as worries about Middle East oil supplies returned. IndiGo first added its fuel charge in March, early in the conflict.
What we know: IndiGo and Korean Air are both charging travelers more to cover fuel.
What we don't: Whether U.S. airlines will raise fares further when they report third-quarter results.
Where outlets agree The Indian Express and Skift both report that IndiGo's new fuel charges apply to bookings from Tuesday after jet fuel prices rose more than 14% in a month.
Where they differ IndiGo calls its increase modest, while Skift notes that domestic charges are up 29% to 47% from April levels.