Virgin Australia to cut flights and raise fares after fuel hit

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Virgin Australia says its fuel bill will be $30–$40 million higher than expected for the second half of the financial year. In response, the airline will reduce domestic capacity by 1% over the next three months and increase revenue per seat targets.

The airline says jet fuel prices have more than doubled since late February, driven by global supply disruptions. It is using fuel hedging and adjusting fares and flight schedules to manage the impact.

Meanwhile, Qantas has taken stronger action, cutting domestic capacity by 5%. It expects to spend up to $3.3 billion on fuel, with rising refinery costs adding a potential $500–$800 million hit to profits.

Both airlines say they are closely monitoring supply chains and working with suppliers to secure fuel in the coming months.

The pressure comes amid ongoing tensions around the Strait of Hormuz, a key route for global oil shipments. Disruptions in the region have pushed up fuel prices worldwide.

A recent report by Morningstar DBRS warned that Australian airlines could be among the hardest hit if fuel shortages worsen, due to their reliance on imported jet fuel.

For travellers, this means fewer flight options and higher fares, at least in the short term.

Source : 9News

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