AirAsia sees jet fuel at US$160-US$190 a barrel, may raise fares if prices spike

KUALA LUMPUR, Sept 18 — AirAsia Group Bhd anticipates jet-fuel prices between US$160 and US$190 per barrel, suggesting possible airfare increases if prices soar to US$250 per barrel, according to co-founder and adviser Tan Sri Tony Fernandes. During a virtual media briefing, Fernandes stated that AirAsia had already adjusted fares for jet-fuel costs up to US$180 but could raise prices further if needed.

Despite the potential fare hikes, Fernandes remains optimistic about demand, citing a load factor of at least 80 percent. The Malaysian operations of AirAsia remain its largest and strongest business, with a 60 percent market share predicted to grow to 70 percent. AirAsia reported a second-quarter net loss of RM830.5 million due to a 58 percent rise in fuel expenses, but core Malaysian short-haul operations remained profitable.

Over 250 planes are expected to return to service by October, and 25 older, less fuel-efficient aircraft have been returned to lessors to alleviate lease obligations and operating costs.