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Airlines around the world are raising ticket prices and fuel surcharges as the conflict in Iran sends jet fuel costs to record highs, squeezing carriers and travelers alike.
According to Channel News Asia, jet fuel prices have more than doubled since U.S.-Israeli strikes on Iran began, jumping from around $85 to $90 per barrel to between $150 and $200 per barrel. The spike is forcing airlines to pass those costs on to passengers through higher fares and added surcharges.
Australia's Qantas Airways, Scandinavia's SAS, and Air New Zealand were among the first to announce fare increases on Tuesday (March 10), all citing the fuel cost surge tied to the Middle East conflict. Air New Zealand also suspended its full-year 2026 financial outlook, saying the uncertainty made forward planning impossible. The airline raised one-way economy fares by NZ$10 on domestic routes, NZ$20 on short-haul international routes, and NZ$90 on long-haul flights.
Hong Kong Airlines announced it would raise fuel surcharges by up to 35% beginning Thursday (March 12), with the steepest increases hitting flights to the Maldives, Bangladesh, and Nepal. In Vietnam, airline operating costs have climbed as much as 70%. Thai Airways said it plans to raise ticket prices by 10 to 15% to offset the rising fuel burden, according to Channel News Asia.
Finland's Finnair, which had locked in prices for more than 80% of its first-quarter fuel needs, still issued a stark warning. "A prolonged crisis could affect not only the price of fuel but also its availability, at least temporarily," a Finnair spokesperson said. Kuwait, a key supplier of jet fuel to northwest Europe, has already seen output cuts.
In Canada, WestJet acknowledged the impact, telling Global News that "the recent sharp increase due to the situation in Iran has already made operating flights more expensive," adding that "further pricing adjustments may be needed." Air Canada said it had hedged "a small portion" of its short-term fuel needs to manage price swings but declined to comment on potential fare hikes.
Airspace disruptions are adding to the pressure. On Tuesday (March 10), planes arriving in Dubai were briefly held in a holding pattern after a potential missile threat, according to flight tracking service Flightradar24, as reported by The Daily Record. The planes eventually landed safely. Emirates, Qatar Airways, and Etihad — which together handle about one-third of all passenger traffic between Europe and Asia — have seen their operations severely disrupted.
Not every airline is feeling the pinch equally. British Airways parent company IAG said it is well-hedged for the near term and has no plans to raise fares. Singapore Airlines and its budget carrier Scoot said they do not impose fuel surcharges, with fares instead driven by supply and demand.
U.S. airline stocks have taken a hit. Shares of Delta Air Lines, United Airlines, Southwest Airlines, and American Airlines fell between 2% and 4% in early trading Tuesday (March 10). Unlike many European and Asian carriers, most major U.S. airlines no longer hedge fuel costs, leaving them more vulnerable to price swings. Deutsche Bank data shows U.S. airfares climbing rapidly, with both last-minute and advance-purchase tickets surging over the past week.
Oil prices did ease somewhat on Tuesday (March 10), falling to around $90 per barrel from a high of $119 on Monday (March 9), after President Trump said the war could be over soon. Airline stocks in Europe bounced back, rising between 3% and 8%.
Analysts at Melius have already cut their net income estimates for U.S. airlines by 10%, and major carriers are expected to update their financial outlooks ahead of an industry conference next week. With spring break demand forecasted to be strong, some analysts believe the market may absorb the higher fares — but uncertainty over how long the conflict will last continues to cloud the industry's outlook.