{
  "id": 19753005,
  "title": "Asia-Pacific airlines brace for prolonged fuel pain as hedging cover thins",
  "url": "https://urgent.news/2026/11/13/asia-pacific-airlines-brace-for-prolonged-fuel-pain-as-hedging-cover-19753005",
  "topic": "business",
  "section": "Business",
  "published": "2026-11-13T03:22:57.000Z",
  "source": {
    "name": "CNA - Business",
    "slug": "cna-business",
    "url": "https://www.channelnewsasia.com/asia/airlines-high-fuel-prices-hedging-contracts-expire-6548296"
  },
  "original_language": "en",
  "account": "Asia-Pacific airlines are bracing for prolonged fuel-related financial challenges as hedging contracts expire, leaving carriers to decide whether to secure new hedges at higher rates, according to executives from the Association of Asia Pacific Airlines (AAPA). The spot price of jet fuel is currently around US$148 per barrel, down from nearly US$180 at the end of October, but still significantly higher than the US$85 level prior to the Iran conflict in late February, notes Wong Hong, AAPA's director general. Fuel now accounts for approximately 33% of airlines' operating costs, compared to the 25% estimated by global industry group IATA last year before price surges.\n\nHedging contracts held by airlines over the past six to eight months have mostly provided some relief, but re-hedging at higher prices poses a tough dilemma, as carriers weigh the likelihood of fuel prices remaining elevated. Air Astana CEO Ibrahim Canliel stated that his company's first-half hedges are expiring, and current fuel prices are not favorable for new hedging. However, Canliel plans to rebuild the airline's hedging position, aiming to cover about 30% of its total fuel consumption outside Kazakhstan, which represents roughly 30% of its annual fuel purchases.\n\nJapan Airlines (JAL) anticipates fluctuations in fuel prices and is budgeting for a worst-case scenario of US$160 per barrel, based on the average price paid between April and September. All Nippon Airways (ANA) expects its fuel costs to rise by 100 billion yen (US$626 million) this fiscal year, above initial projections, but expects the fuel market to stabilize in the second half of its financial year ending March 31. Both JAL and ANA hedge only domestic fuel consumption and rely on fuel surcharges and ticket price changes to cover international exposure. Neither airline has indicated any changes to this approach.\n\nWith oil prices on the rise, ticket prices have also increased, but not at a rate sufficient to fully offset higher fuel costs. The industry faces uncertainties, as passenger growth has been negative in aggregate from April to August, with September growth just above water, according to Wong Hong. Capacity cuts may become a potential risk for Asia-Pacific airlines as margins are being squeezed, even at carriers with substantial hedging. Singapore Airlines experienced a 56% increase in fuel costs in the six months to September, cutting operating profit by 29%, despite record revenue. Hedging provided some protection, but CFO JoAnn Tan emphasized that hedging does not offer a complete solution, as fuel prices remain unpredictable.",
  "summary": "Fuel now makes up about 33 per cent of airlines' operating costs, says director general of the Association of Asia Pacific Airlines Wong Hong.",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}