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Virgin Australia tells trade partners it is lifting airfares
Virgin Australia told travel agents late last week that it was being forced to review its fares in light of rising fuel costs.
- Airline Virgin Australia informed travel agents late last week that it was reviewing its fares to counter rising costs.
- Sustained high oil prices due to a stalemate between Iran and the US, and ongoing tension between Russia and Ukraine, have seen the cost of aviation fuel soar.
- Aviation fuel is one of the biggest expenses for an airline, accounting for up to 30 per cent of overheads on average.
Virgin Australia has informed travel agents that it will have to lift ticket prices to counter the soaring cost of fuel.
The airline confirmed to The Money Edition that it spoke to trade partners on Friday, informing them that a review of its fares were underway.
“Virgin Australia regularly reviews its fares in response to external market conditions,” a spokesperson said.
“As we foreshadowed in our FY26 results announcement, costs across the aviation sector continue to rise at a rate well ahead of national inflation.”
The spokesperson said while it was adjusting its fares to account for higher fuel costs, it was still focused on providing value to customers.
“We are making fare adjustments to reflect these increased costs,” the spokesperson said.
“We remain focused on providing value and choice for our customers.”
Aviation industry battling sky-high jet fuel prices
Virgin Australia’s fare adjustment comes as all airlines globally battle market conditions that have seen jet fuel prices remain elevated for far longer than expected.
Australia’s Competition and Consumer Commission flagged in June that all airlines were being forced to review prices in light of higher costs.
“Ongoing conflict in the Middle East has disrupted global fuel markets,” the ACCC said.
“Jet fuel prices were over 40 per cent higher in early June 2026 compared to mid-February 2026, increasing cost pressures across the aviation sector.
“Refining margins, the cost of converting crude oil into jet fuel, also remain significantly elevated. The spread between the price of Brent crude oil and jet fuel was 64 per cent higher in early June than in February.”
In its financial results, fellow Australian airline Qantas flagged that it was expecting to pay billions for fuel in six months alone.
“Jet fuel prices are expected to remain elevated through the first half of FY27,” the Qantas board said.
“The Group will continue to take mitigating action and remains highly hedged in Brent crude oil, with significant levels of favourable participation if fuel prices decline.
“Fuel costs in the first half of FY27 are expected to be approximately $3.6 billion, including hedging, gross carbon costs and fuel transformation initiatives.”
Topics: Airlines, Fuel, Virgin Australia