business
Qantas to raise airfares and cut domestic flights as fuel costs rise by $1 billion
Qantas will raise airfares and cut domestic flights as fuel costs rise by more than $1 billion.
Key points
- Domestic capacity reduction rises from 1 per cent in the first quarter of 2027 to 5 per cent in the second quarter.
- International capacity expansion is expected to remain firm at 2 per cent across the same period.
- Qantas now expects its fuel bill for the final six months of 2026 to be $3.75 billion, up from $3.6 billion.
Why it matters. Domestic travellers face higher fares and fewer flights as Qantas adjusts pricing and capacity to higher fuel costs, though the airline says demand remains resilient.
Qantas said in a market update it will continue to adjust fares and capacity as its fuel costs rise by more than $1 billion, nine months after the Middle East conflict erupted. Domestic capacity cuts will deepen from 1 per cent in the first quarter of 2027 to 5 per cent in the second quarter, while international capacity expansion holds at 2 per cent. Its fuel bill for the final six months of 2026 is now expected at $3.75 billion, up from a previous forecast of $3.6 billion.
Latest updates
Qantas to raise airfares and cut domestic flights as fuel costs rise by $1 billion
Qantas has announced that it will raise airfares and make deeper cuts to its domestic flight schedule early next year. The airline is responding to rising fuel prices, which it says have added about $1 billion to its costs. The changes will reduce capacity on domestic routes and are likely to increase what passengers pay for tickets. The announcement comes as Australian airlines face sustained pressure from energy costs. Further details on which routes will be affected were not included in the initial reports.