South Korean airlines raised fuel surcharges on both domestic and international routes starting in September, as jet fuel prices surged again. Travelers buying new tickets face higher costs, with round-trip surcharges on long-haul routes to the United States and Europe reaching several hundred thousand won.
Korean Air (003490) applies surcharges ranging from 48,000 won to 354,000 won one-way, depending on the route, to international tickets issued from the 1st, according to the airline industry. That compares with a range of 35,200 won to 259,200 won last month.
The increases are steepest on long-haul routes to the Americas. Surcharges on flights from Incheon to New York, Dallas, Boston, Chicago, Atlanta, Washington and Toronto rise to 354,000 won one-way from 259,200 won. On a round-trip basis, that means an increase of 189,600 won, or 36.6%, to 708,000 won from 518,400 won.
Asiana Airlines (020560) also raised international surcharges from the same date. On major long-haul routes including Incheon to Los Angeles, San Francisco, New York, Sydney, Frankfurt, Paris and London, the surcharge rises 43% to 290,100 won this month from 202,900 won last month.
Low-cost carriers joined the increases. Jin Air (272450) raised surcharges on international routes departing Korea to $29 from $20 for flights under 600 miles, and to $41 from $27 for routes of 600 to 1,199 miles. T'way Air charges between 36,200 won and 247,500 won one-way depending on route distance. Jeju Air (089590) also raised surcharges on international routes departing Korea this month.
Jet Fuel Rebounds After Three Straight Monthly Declines
Fuel surcharges are a mechanism that passes part of an airline's higher fuel costs on to ticket prices when international oil prices rise. For international routes, the surcharge is divided into 33 tiers based on the Singapore jet fuel average price, known as MOPS, with each airline setting route-specific amounts based on factors such as flight distance.
The latest increase is the first in four months. Korean Air's international surcharge reached the highest tier, 33, in May, when international oil prices surged amid instability in the Middle East. Jet fuel prices then stabilized, and the surcharge fell for three consecutive months to tier 27 in June, tier 19 in July and tier 14 in August.
That trend reversed this month. The September surcharge is set at tier 21, a jump of seven tiers in a single month.
The average Singapore jet fuel price during the assessment period from July 16 to August 15 came to 355.46 cents per gallon. That is more than 25% higher than the 283.48 cents recorded during the assessment period for the August surcharge.
Domestic surcharges also rose. Korean Air, Asiana Airlines, Jin Air and Air Seoul set their September domestic surcharge at 20,900 won one-way, up 4,400 won, or 26.7%, from 16,500 won last month.
Surcharges are applied based on the date a ticket is issued, not the date of the flight.
As a result, passengers who completed ticketing by August will not pay the increase even if their flights depart in September or later. Conversely, if jet fuel prices fall and surcharges are lowered, amounts already paid will not be refunded.
