Episode 10
Passengers rush to buy plane tickets before April’s steep fuel surcharges kick in
This article is by Sarah Chea and read by an artificial voice. With the protracted Iran war disrupting jet fuel supply, fuel surcharges at Korean airlines are set to triple, which could add as much as 400,000 won ($270) to the cost of a round-trip tic...
Korea JoongAng Daily - Daily News from Korea · SARAH CHEA
March 27, 20266m 36s
Show Notes
This article is by Sarah Chea and read by an artificial voice.
With the protracted Iran war disrupting jet fuel supply, fuel surcharges at Korean airlines are set to triple, which could add as much as 400,000 won ($270) to the cost of a round-trip ticket.
Some flights have already been canceled, and airlines are announcing across-the-board reductions in operations.
Oil prices, closely intertwined with currency movements and acutely sensitive to geopolitical shocks, are expected to dampen demand for long-haul routes, thereby compounding financial pressures on airlines over the longer term.
Heavier tickets, bigger bills
Korean Air recently spiked its fuel surcharges on tickets issued from April, with one-way fees for its longest-haul routes — those exceeding 6,500 miles, including Incheon to New York and Toronto — climbing more than three-fold from 99,900 won in March to 303,000 won.
That means each passenger will have to pay an additional 400,000 won for a round-trip ticket. For a family of four, that translates into an additional burden of up to 1.6 million won for the trip.
On most European routes, including London, Paris and Frankfurt, surcharges will jump from 79,500 won to 276,000 won, while even fees for short routes, under 499 miles, such as Fukuoka in Japan and Qingdao in China, will rise from 13,500 won to 42,000 won.
Asiana Airlines also hiked its surcharge for a ticket to New York from 78,600 won to 251,900 won, while its Fukuoka route saw fees jump from 14,600 won to 43,900 won.
"After the fuel surcharge announcement, ticket inquiries are on the rise, but mainly on short-haul routes rather than long-haul ones," said a source at one of Korea's major airlines.
"A fuel surcharge doesn't fully offset all of the rising oil prices," they continued. "If this trend continues, surcharges will climb even higher in May, and if it drags on, it becomes truly perilous."
Set every month, fuel surcharges are additional fees imposed by airlines to offset losses stemming from rising oil prices, which account for roughly 30 percent of total airfare prices.
These surcharges are calculated based on the average price of Singapore jet fuel, which uses a 33-tier pricing system. That price has surged to Level 18 between Feb. 16 and March 15 from Level 6 in the previous month — an increase of 12 levels in just a month, marking the steepest monthly jump since the current pricing mechanism was introduced in 2016. Even during the sharp run-up in oil prices following the Russia-Ukraine war in 2022, the index only climbed by eight levels over three months.
Korean Air uses around 30 million barrels of jet fuel every year and each $1 increase in the price of oil translates into roughly 45 billion won in additional annual costs.
Fuel surcharges on Air Premia's New York routes, priced in U.S. dollars, will jump from $57 this month to $194 next month. On T'way Air's Paris flights, surcharges will rise from 67,600 won to 213,900 won. Air Busan and Jin Air have also increased fuel surcharges on their Incheon–Fukuoka routes by more than three-fold.
The surge in fuel surcharges among Korean carriers is far steeper than that at foreign airlines, largely due to Korea's heavy reliance on Middle Eastern crude.
Airlines such as Thai Airways and United Airlines have responded not with separate surcharges but by raising base fares by roughly 5 to 20 percent. Carriers without fuel surcharges, like Air France and KLM, have increased long-haul ticket prices by about 50 euros ($58).
"Once oil prices rise, they rarely come down quickly, and it takes even longer for those increases to be reflected in airfares, which inevitably forces fuel surcharges to climb gradually," said Professor Lee Hwi-young at the Department of Airline Service Management at Inha Technical College.
"Oil prices are closely linked to exchange rates, and a stronger won tends to dampen travelers' willingness to spend," Lee added. "While demand for long-haul routes is plunging, the absolute vo...
With the protracted Iran war disrupting jet fuel supply, fuel surcharges at Korean airlines are set to triple, which could add as much as 400,000 won ($270) to the cost of a round-trip ticket.
Some flights have already been canceled, and airlines are announcing across-the-board reductions in operations.
Oil prices, closely intertwined with currency movements and acutely sensitive to geopolitical shocks, are expected to dampen demand for long-haul routes, thereby compounding financial pressures on airlines over the longer term.
Heavier tickets, bigger bills
Korean Air recently spiked its fuel surcharges on tickets issued from April, with one-way fees for its longest-haul routes — those exceeding 6,500 miles, including Incheon to New York and Toronto — climbing more than three-fold from 99,900 won in March to 303,000 won.
That means each passenger will have to pay an additional 400,000 won for a round-trip ticket. For a family of four, that translates into an additional burden of up to 1.6 million won for the trip.
On most European routes, including London, Paris and Frankfurt, surcharges will jump from 79,500 won to 276,000 won, while even fees for short routes, under 499 miles, such as Fukuoka in Japan and Qingdao in China, will rise from 13,500 won to 42,000 won.
Asiana Airlines also hiked its surcharge for a ticket to New York from 78,600 won to 251,900 won, while its Fukuoka route saw fees jump from 14,600 won to 43,900 won.
"After the fuel surcharge announcement, ticket inquiries are on the rise, but mainly on short-haul routes rather than long-haul ones," said a source at one of Korea's major airlines.
"A fuel surcharge doesn't fully offset all of the rising oil prices," they continued. "If this trend continues, surcharges will climb even higher in May, and if it drags on, it becomes truly perilous."
Set every month, fuel surcharges are additional fees imposed by airlines to offset losses stemming from rising oil prices, which account for roughly 30 percent of total airfare prices.
These surcharges are calculated based on the average price of Singapore jet fuel, which uses a 33-tier pricing system. That price has surged to Level 18 between Feb. 16 and March 15 from Level 6 in the previous month — an increase of 12 levels in just a month, marking the steepest monthly jump since the current pricing mechanism was introduced in 2016. Even during the sharp run-up in oil prices following the Russia-Ukraine war in 2022, the index only climbed by eight levels over three months.
Korean Air uses around 30 million barrels of jet fuel every year and each $1 increase in the price of oil translates into roughly 45 billion won in additional annual costs.
Fuel surcharges on Air Premia's New York routes, priced in U.S. dollars, will jump from $57 this month to $194 next month. On T'way Air's Paris flights, surcharges will rise from 67,600 won to 213,900 won. Air Busan and Jin Air have also increased fuel surcharges on their Incheon–Fukuoka routes by more than three-fold.
The surge in fuel surcharges among Korean carriers is far steeper than that at foreign airlines, largely due to Korea's heavy reliance on Middle Eastern crude.
Airlines such as Thai Airways and United Airlines have responded not with separate surcharges but by raising base fares by roughly 5 to 20 percent. Carriers without fuel surcharges, like Air France and KLM, have increased long-haul ticket prices by about 50 euros ($58).
"Once oil prices rise, they rarely come down quickly, and it takes even longer for those increases to be reflected in airfares, which inevitably forces fuel surcharges to climb gradually," said Professor Lee Hwi-young at the Department of Airline Service Management at Inha Technical College.
"Oil prices are closely linked to exchange rates, and a stronger won tends to dampen travelers' willingness to spend," Lee added. "While demand for long-haul routes is plunging, the absolute vo...