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Japan’s ANA, JAL Airlines to Double Fuel Surcharges for Intl Flights in June Amid Soaring Oil Prices Due to Iran War

Yomiuri Shimbun file photo
Japan Airlines and All Nippon Airways aircraft

All Nippon Airways Co. and Japan Airlines Co. are expected to increase their fuel surcharges by as much as double on international flights starting with bookings for June, following a spike in crude oil prices triggered by U.S. and Israeli attacks on Iran.

As the effects of rising oil prices spread throughout the economy, there is increasing concern that surcharge hikes may deter travelers and lead to a decline in inbound tourism, according to observers.

The fuel surcharge is an extra fee collected by airlines in addition to fares in order to offset sharp fluctuations in fuel prices and exchange rates, with the amount revised every two months.

The rise in fuel prices in February and March is automatically reflected in the surcharges set for June and July.

With fuel costs soaring after the strikes against Iran in late February, ANA and JAL are expected to raise their surcharges for June-July tickets about 50% to 100% higher than the April-May rate.

The upcoming hike will bring surcharges for routes to Europe and North America to ¥55,000 at ANA, a ¥23,100 hike, while JAL’s fee will rise by ¥21,000 to ¥50,000.

The surcharge for routes to China and Taiwan will rise by ¥4,900 to ¥14,300 at ANA, while JAL’s fee is projected to increase by ¥5,000 to ¥12,400.

Airlines worldwide have introduced fuel surcharges, with ANA and JAL adopting the system in 2005. These fees also increased in 2022 due to Russia’s aggression against Ukraine.

At present, average prices in the benchmark Singapore market have skyrocketed to more than twice their pre-attack levels, likely pushing surcharges to the upper limit of the existing framework.

Should fuel prices remain high, fuel surcharges may prove insufficient to offset costs. A hit to airline profitability is unavoidable, potentially prompting companies to request a revision of the current system, including a hike in the surcharge ceiling, observers said.

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