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Photo courtesy of Korean Air |
[Alpha Biz= Kim Jisun] SEOUL, July 20 — Fuel surcharges on international flights are expected to continue rising amid heightened oil price volatility following the Iran-Israel conflict and growing demand during the summer holiday season.
According to industry sources on Saturday, Korean Air will raise its fuel surcharge for one-way international tickets issued in August. The surcharges, which currently range from 7,000 to 57,400 KRW depending on distance, will increase to between 12,600 and 92,400 KRW.
Asiana Airlines also raised its fuel surcharge for next month to 13,700–73,900 KRW, up from last month’s 8,200–48,100 KRW. Low-cost carriers (LCCs) are expected to follow suit.
Last month, surcharges reached their lowest level since November 2011. However, prices rebounded as oil prices surged.
According to the Singapore jet fuel spot price index, fuel surcharges are applied when the average price exceeds 150 cents per gallon. In August, the surcharge tier rose from level 4 to level 6.
The average jet fuel price used to calculate August surcharges—measured from June 16 to July 15—was $87.32 per barrel, up 10.2% from the $79.22 average a month earlier. Analysts attributed the spike to the U.S. airstrike on Iranian nuclear facilities.
Although oil prices have since fallen back to the $68–72 per barrel range following a ceasefire agreement between Israel and Iran, industry watchers note that summer travel demand may continue pushing both oil prices and fuel surcharges higher in the near term.
AlphaBIZ Kim Jisun(stockmk2020@alphabiz.co.kr)
