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Budget airline AirAsia X is hiking airfare and cutting flights in response to jet fuel shortages amid the war in the Middle East.
The Malaysian carrier raised prices by as much as 40% and fuel surcharges by 20%, Bloomberg reported.
Group Chief Executive Officer Bo Lingam said in a media briefing on Monday that the average cost of jet fuel has soared to about $200 per barrel, compared to around $90 previously, and that soaring costs is the airline’s most urgent obstacle.
“Amid ongoing geopolitical uncertainty and supply chain disruptions, global jet fuel prices have surged to more than double 2025 levels. In response, we have implemented carefully calibrated fare adjustments, including a one-off fuel surcharge across the network,” Lingam said in a statement.
About 10% of the carrier’s flights after the Eid al-Fitr holidays have been cut as well, and they’re scaling back on unprofitable routes.
While some reductions are expected to be temporary, others will ultimately be a permanent change, Lingam said.
AirAsia X is modifying its aircraft deployment and bringing forward maintenance checks to manage costs as well.
“We’ve been through many crises,” co-founder and strategic adviser Tony Fernandes said at the briefing, adding that while they don’t “have all the answers,” management is looking at past experiences and is prepared to respond however needed, including cutting capacity or reducing costs.
Fernandes noted that higher prices were “unavoidable,” and capacity would be cut on routes “where we don’t believe we can cover the cost of the fuel.”
Despite these complications, AirAsia X is still planning on going through with its expansion into the Middle East, launching the airline’s first Middle East hub in Bahrain and a Kuala Lumpur-Bahrain-London route on June 26.
The airline, which flies to more than 150 destinations across 25 countries, is committed to this timeline if conditions improve in time, Lingam said.
Flight bookings from Europe and other regions flying into Asia are rising, and the company wants to increase frequencies to Central Asia, including Istanbul, Group Chief Commercial Officer Amanda Woo said.
As travel demand continues to shift, AirAsia X is also looking into partnering with other carriers, and the airline reported there is still an unwavering amount of demand to travel.
“While we are operating in an increasingly challenging environment, we are seeing strong demand across our Asean destinations, which demonstrates the resilience of our network and the growing appetite for regional travel,” Lingam said.
AirAsia X isn’t the first airline to cut flights in the wake of the Iran war.
Scandinavian Airlines (SAS) said it will be canceling 1,000 flights in April due to the rising oil and jet fuel prices.
SAS CEO Anko van der Werff noted that the airline had made the decision to cancel some departures in an effort to save money, and if the conflict goes on for a long time, they will have to raise prices.
Meanwhile, Abu Dhabi-based Etihad Airways is taking a different route, cutting fares on long-haul flights up to 50% in an effort to recover passenger numbers.
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