Qantas Raises Fares and Cuts Flights Amid Fuel Costs
Qantas is increasing airfares and reducing domestic flight capacity by 4 percent to offset rising fuel costs driven by conflict in Iran.
Qantas Airways Limited is increasing airfares and reducing domestic flight schedules in Australia by 4 percent during the first quarter of 2027. This capacity reduction is double the 2 percent cut the airline previously forecast in August, a move designed to offset rising fuel costs.
The airline expects its fuel bill for the second half of 2026 to reach $3.75 billion, driven by elevated energy prices resulting from the war in Iran. To manage these expenses, the company has allocated $3.8 billion for fuel in the first half of the new financial year and hedged approximately 85 percent of its annual bill.
Despite these financial pressures, the company reports resilient domestic leisure and international demand, noting that international travel is supported by customers redirecting flights away from the Middle East. Qantas previously reported a 2025/26 net profit of $1.3 billion, a 19.8 percent decrease from the prior year, and has cancelled a planned $150 million share buyback.
Looking toward long-term growth, the airline expects its Project Sunrise non-stop flights to London and New York to generate $400 million annually by 2030/31.
