Steep Surcharge Hikes Begin May 1
Thai Airways International will implement substantial fuel surcharge increases of up to 100% on numerous international routes beginning May 1, as the national carrier grapples with jet fuel prices that have more than doubled since the outbreak of war in the Middle East two months ago. The Bangkok-based airline announced the dramatic pricing adjustments on Tuesday, citing fuel costs that have surged from roughly $80 per barrel to peak levels of $240, with recent trading around $180 per barrel.
The increases represent a significant financial adjustment for travelers booking tickets issued from May 1 onwards. Economy class surcharges on long-haul routes such as Bangkok to London or Milan will jump from 9,990 baht to 19,070 baht. Business class passengers on these same routes will see fuel surcharges rise from 18,680 baht to 35,750 baht. Regional routes face similar pressure, with flights to Beijing and Delhi seeing economy surcharges climb from 4,580 baht to 8,760 baht, and business class increasing from 6,440 baht to 12,130 baht.
The new pricing structure affects multiple destinations across the airline’s network. Short-haul flights to Yangon will see economy surcharges increase from 1,780 baht to 3,390 baht, while business class rises from 2,580 baht to 4,930 baht. Services to Seoul and Narita will implement economy surcharges of 10,630 baht, up from 5,540 baht, with business class reaching 15,530 baht from the previous 8,120 baht. Sydney-bound passengers will face economy surcharges of 14,170 baht, nearly double the previous 7,410 baht, and business class fees of 20,930 baht, increased from 10,950 baht.
The Global Fuel Crisis
These pricing changes reflect a broader crisis gripping the global aviation industry. Jet fuel has historically represented approximately 25% of airline operating costs, but industry analysts note this figure has climbed to nearly 45% in recent weeks. The surge traces directly to the conflict involving Iran, Israel, and the United States, which has disrupted supply chains through the Strait of Hormuz, the world’s most critical oil transit passage.
The Middle East conflict has created unprecedented volatility in energy markets. Iran has effectively restricted traffic through the Strait of Hormuz, which normally carries nearly 20% of global oil production. More than 80% of the oil and gas moving through this strait is destined for Asian markets, making carriers like Thai Airways particularly vulnerable to supply interruptions. Fatih Birol, Executive Director of the International Energy Agency, emphasized the severity of the situation.
Europe has maybe six weeks of jet fuel left. In the past there was a group called Dire Straits. It is a dire strait now.
European jet fuel prices hit an all-time high of $1,838 per tonne in early April, up from $831 before the war began. The benchmark Platts index assessed Singapore jet fuel prices at $228.76 per barrel in early April, remaining above $200 for consecutive trading sessions. This represents nearly double the levels seen in January 2026 and significantly exceeds crude oil price increases, explained by refining costs and the fact that kerosene is a lower priority than petrol or diesel.
Regional Airlines Respond
Thai Airways is not alone in implementing drastic measures. Across the Asia Pacific region, carriers are adjusting pricing strategies to survive the fuel shock. Cathay Pacific has raised fuel surcharges by 34% across all routes from April 1, with long haul flights now carrying charges of 1,560 Hong Kong dollars. The airline reviews these surcharges every two weeks to enable agile responses to volatile prices. Air New Zealand has cancelled 1,100 flights affecting over 44,000 passengers between March and May, while Qantas has delayed planned share buybacks and increased its estimated fuel bill forecast for the second half of 2026 to between A$3.1 billion and A$3.3 billion.
Southeast Asian regulators have adjusted frameworks to accommodate the crisis. Indonesia raised its maximum fuel surcharge cap to 38% from previous levels of 10% for jets and 25% for turboprops, supported by temporary fiscal measures including the removal of 11% VAT on airline tickets. The Philippines elevated its applicable fuel surcharge to Level 8, allowing airlines to impose fees ranging from Philippine peso 253 to 6,208.98 depending on distance. Vietnam reports that more than 60% of airlines have implemented or planned fare increases ranging from 5% to 20%.
Other major carriers have implemented similar strategies. Air India has shifted from flat domestic surcharges to distance-based pricing, with fees increasing to $200 for North America and Australia routes from March 18. United Airlines CEO Scott Kirby warned that ticket prices may need to rise by 15% to 20% to offset fuel costs, while American Airlines has increased checked baggage fees by $10 for the first and second bags. Delta Air Lines plans to cut capacity by 3.5 percentage points and has pulled all planned capacity growth for the current quarter.
Thai Airways Strategic Position
Thai Airways executives have emphasized that the pricing adjustments reflect cost pressures rather than profit-taking. Chief Executive Officer Chai Eamsiri stated that the airline is not taking advantage of the situation but simply adjusting to higher costs.
We are not taking advantage of the situation, this is simply an adjustment in line with higher costs.
Chief Financial Officer Cherdchom Therdthirasak advised passengers to secure tickets promptly before fares rise further, noting that availability has become extremely limited across European and other destinations over the next two weeks.
Despite the pricing pressures, Thai Airways reports that advance bookings for March 2026 remain robust, with direct Europe-Thailand routes showing cabin factors of 80-90%. The carrier has observed a shift in passenger behavior, with more travelers choosing direct flights to avoid transiting through Middle East hubs that face operational disruptions. The airline has also adjusted flight paths to circumvent conflict zones, routing around Iranian airspace despite slightly increased fuel burn.
Operationally, Thai Airways maintains it has not cancelled flights due to the crisis and continues to expand its network. The airline plans to grow its fleet from 80 aircraft to 102 by 2026, comprising 67 wide body and 35 narrow body aircraft. This expansion includes deliveries of 14 Boeing 787-9 wide body jets and 14 Airbus A321neo narrow body aircraft this year. New route launches planned for 2026 include Amsterdam and Auckland in the third quarter, additional Chinese destinations including Changsha, Xiamen and Chongqing during the second and third quarters, plus Busan in South Korea and Da Nang in Vietnam.
Rath Rauksamruad, Director of Corporate Finance at Thai Airways, explained that the company targets a 2:1 wide body to narrow body ratio to support its hub strategy of bringing international passengers to Thailand for regional connections. While prioritizing liquidity maintenance during this abnormal period, the airline has stated it currently has no plans to seek new loans. The fuel surcharge mechanism in Thailand requires coordination with the Civil Aviation Authority of Thailand, which regulates the ceiling for such charges.
Traveler Guidance
For travelers planning trips in the coming months, industry experts recommend immediate action to avoid further price increases. Transport professors and aviation analysts suggest customers hoping to fly in coming months should book immediately to avoid widespread price hikes of up to 30%. Those planning travel for September or later may benefit from waiting to see if diplomatic resolutions emerge, though the timeline remains uncertain.
Travelers should be aware that the fuel surcharges are included in ticket prices and vary by route and class of service. The airline has established a special fuel surcharge for flights departing from Japan to Bangkok charged at the time of ticket issuance between April 1 and May 31, according to regulatory filings. Passengers booking through loyalty programs should note that award tickets may also carry increased surcharges, though some carriers offer discounts for advance bookings.
Alternative options include exploring regional destinations within Southeast Asia and the Pacific, where short haul flights use less jet fuel and face less severe price pressure. Airlines service these routes with greater frequency and competition, potentially offering more stable pricing compared to long haul international services. However, all carriers globally face the same underlying fuel market pressures, making significant price reductions unlikely while the Middle East conflict continues.
Key Points
- Thai Airways will increase fuel surcharges by up to 100% on tickets issued from May 1, with economy flights to London and Milan rising from 9,990 baht to 19,070 baht
- Jet fuel prices have surged from $80 per barrel before the Middle East conflict to peaks of $240, currently trading around $180
- Fuel costs have jumped from 25% to 45% of airline operating expenses, forcing carriers worldwide to raise fares or cancel flights
- The U.S.-Israeli war on Iran has disrupted supply through the Strait of Hormuz, which carries 20% of global oil production
- Thai Airways plans to expand its fleet from 80 to 102 aircraft by 2026 while launching new routes to Amsterdam, Auckland, and additional Asian destinations
