AirAsia X to raise fares, cut capacity over Middle East war

KUALA LUMPUR: Budget carrier AirAsia X said on Monday (Apr 6) it will need to raise fares and cut some flights in places where it can no longer cover fuel costs, with oil prices surging due to the conflict in the Middle East.

The company has raised fuel surcharges by about 20 per cent, while fare prices have increased between 31 per cent and 40 per cent, it said. 

Jet fuel prices have risen to up to US$300 per barrel in some markets, and the airline - which in January completed its takeover of the short-haul aviation business from its former parent and affiliate Capital A - has been hit hard.

However, AirAsia X co-founder and Capital A chief executive Tony Fernandes said demand for flights remained high, and he was optimistic the airline would return stronger after the crisis. 

The airline's chief executive Bo Lingam told a press conference on Monday that it remained set on opening a planned hub in Bahrain in June, though he was non-committal on whether the plans would go ahead if the conflict drags on. 

AirAsia X in February unveiled plans to resume flights from Kuala Lumpur to London via the Bahrain hub, its first outside Asia, with services due to begin on Jun 26. 

That announcement, however, came before United States and Israeli airstrikes on Iran later that month, which disrupted aviation across the Middle East, with many airlines cancelling routes to avoid airspace in the region.

Bo said that the Bahrain service would definitely go ahead if the war ends before June, but declined to say if it would proceed in the event of a protracted conflict. 

"Anything's possible," he said when asked if the airline would pursue alternate routes to Europe, such as via its existing flights to Türkiye.