Asia-Pacific airlines face growing exposure to elevated jet fuel prices as older hedging contracts expire and carriers must decide whether to lock in new cover at higher levels, industry executives told Reuters on Friday, November 13, at the Association of Asia Pacific Airlines (AAPA) annual meeting in Kuala Lumpur.
Source: Reuters, Nov 13, 2026
The spot price of jet fuel is trading at about $148 a barrel — down from nearly $180 at the end of October, but still far above the roughly $85 seen before the war with Iran began in late February, and about 75% higher than pre-war levels.
Source: Reuters, Nov 13, 2026
A 'new normal' — or a gamble
Wong Hong, director general of the Association of Asia Pacific Airlines, said airlines that had hedging contracts in place over the past six to eight months were “coming out smelling like a rose”, but now faced re-hedging at higher prices, Reuters reported. Air Astana chief executive Ibrahim Canliel said the industry faces a “new normal” at today's price levels, with Brent likely to stay around $90 to $100 a barrel — though his carrier's first-half hedges have expired and prices were at levels that did not make sense to lock in new cover.
Source: Reuters, Nov 13, 2026
Japan Airlines expects prices to remain volatile, senior managing executive officer Ross Leggett told Reuters; the carrier paid an average price close to $160 a barrel between April and September and is budgeting on that worst case. In Japan, ANA and Japan Airlines hedge only their domestic fuel consumption, Reuters reported.
Source: Reuters, Nov 13, 2026
Surcharges coming, profits already hit
Japan Airlines will introduce a fuel surcharge on domestic flights for the first time in its history from April, and ANA is considering a similar move. ANA chief executive Goichi Hirasawa said the carrier's fuel costs will exceed its initial plan by about 100 billion yen (yaani 100 arab yen) in the fiscal year ending March 31, 2027, Reuters reported.
Source: Reuters, Nov 13, 2026
Singapore Airlines shows the scale of the squeeze even with hedging: its fuel bill rose 56% year-on-year in the six months to September, its average price before hedging was $171 a barrel — up 87% — and hedging gains cut the effective price only to about $145, with operating profit down 29% despite record revenue, Reuters reported.
Source: Reuters, Nov 13, 2026
What is solid
- Reuters reported spot jet fuel at about $148/bbl on Nov 13, down from nearly $180 in late October and up from about $85 pre-war
- AAPA director general Wong Hong put fuel at about 33% of operating costs, versus IATA's 25% estimate last year
- Singapore Airlines' reported half-year figures: fuel bill +56%, operating profit -29% despite record revenue
What is only claimed
- Whether locking in hedges near $148 protects or harms carriers: executives disagreed — Air Astana's CEO called today's levels a 'new normal' yet said they did not make sense to lock in, while others argued cover is insurance against prices going higher
As the last pre-war hedges roll off over the coming months, Asia-Pacific fares and surcharges are the release valve: Japan Airlines' first-ever domestic fuel surcharge starts in April, and other carriers face the same choice between surcharges, thinner margins, or flying unhedged into a fuel market still hostage to the Iran war and Gulf shipping.