The golden age of global travel may be forever in the past

Why Do Fuel Cost Fluctuations Disrupt the Operating Logic of the Aviation Industry?

Full of Uncertainty

Many people haven’t realized that a major upheaval is brewing around 2026.

Recently, if you’re looking at airline tickets, you’ll easily notice an unusual change—prices on almost all routes worldwide are rising together.

For example, the fuel surcharge for domestic flights to Indonesia on Juneyao Airlines has already increased to about 600 yuan; long-haul flights to Europe, America, and Australia are generally seeing costs rise by hundreds to over a thousand yuan. This round of price increases isn’t driven by obvious demand, and it may just be the beginning.

Suddenly, tensions in the Middle East have escalated, the Strait of Hormuz is under pressure, and the world is facing an “oil shortage,” with oil prices soaring. Some gas stations in Thailand are even running out of fuel.

The aviation industry relies heavily on fuel, which typically accounts for 20% to 30% of operating costs. When this variable fluctuates wildly, the entire industry finds it hard to avoid being caught up in the turbulence.

But ticket price hikes are only the surface. What’s truly out of control is the entire operating logic.

01

Costs Are Not Just Rising

They Are Becoming Uncontrollable

What makes this round of ticket price increases special is that they are almost entirely driven by costs.

Industry insiders generally agree: demand hasn’t weakened significantly; in some markets, it remains strong. But prices have been forced upward.

This “demand still exists, but prices are rising first” situation is uncommon in the airline industry.

United Airlines’ response is quite representative. On one hand, they cut capacity by about 5%, proactively reducing flights that are not profitable under current cost conditions; on the other hand, they haven’t chosen to shrink significantly but maintained their expansion pace.

The management’s reasoning is straightforward: if oil prices stay at current levels, fuel alone will increase annual expenses by over a hundred billion dollars.

This seemingly contradictory decision reflects the biggest current problem—it’s not high costs per se, but the uncertainty of costs.

Senior civil aviation expert Li Hanming points out that there’s an even more subtle variable in this impact: changes in airspace are reshaping cost structures. Restrictions on Russian airspace and instability in Middle Eastern routes force flights to detour, extending flight times, increasing fuel consumption, and raising crew costs.

Originally, cost models could be precisely calculated, but they are being continually broken.

This means airlines are no longer facing a fluctuation range manageable through experience; instead, they face unpredictable variables.

When flight costs become uncontrollable, industry reactions tend to converge: raising prices, reducing flights, and controlling risks. That’s why this round of global airline price increases has been so rapid and uniform.

02

Demand Has Not Disappeared

But It Is Becoming More Cautious

Prices are rising, but consumers haven’t immediately stopped traveling.

A senior executive from a leading online travel platform’s international division mentioned that overall price increases are about 10%. For example, a Southeast Asia quality tour originally priced at around 5,000 yuan has now increased by about 500 yuan, which is still within most consumers’ expectations; travel times are still mainly determined by holiday schedules, so there hasn’t been a significant short-term adjustment.

However, subtle changes are already happening—more people are delaying decisions, choosing to book closer to departure to reduce risks from uncertainty.

Meanwhile, the response from the supply chain is more direct.

Currently, there are at least three different approaches: some suppliers incorporate fuel price fluctuations into their quotes in advance; some stop selling long-term products and only offer short-term options; others price based on current costs, expecting fuel prices to fall later and aiming to gain some profit margin.

The existence of multiple pricing strategies within the same market indicates that the industry lacks a consensus on the future.

This uncertainty is also changing the pace of supply. For example, on Southeast Asian routes, many products are only priced up to the May Day holiday, with no quotes beyond that, mainly because no one dares to judge future costs.

Both consumers and suppliers are actively shortening their “decision radius.”

03

The Entire Industry Is Starting to Operate Around “Uncertainty”

If price increases and behavioral changes are internal adjustments, a larger variable comes from the macro level.

Whether oil prices will stay high long-term remains highly debated.

Some believe prices may fall back, even to $50 per barrel; others think high prices will persist longer.

This divergence keeps the entire industry in a state of uncertainty.

The International Monetary Fund has warned that if oil prices stay above $100 per barrel for a long time, the global economy could enter a “stagflation” phase.

For the travel industry, this means a worst-case scenario—costs rise across the board, while consumers’ disposable income may not increase proportionally.

If this situation persists, the impact won’t be limited to airline tickets but will extend to the entire travel chain: hotels, dining, entertainment, shopping—all will see rising costs, forcing consumers to reallocate their spending.

In the short term, due to safety and price considerations, some outbound travelers may shift back to domestic tourism. But this structural shift is unlikely to last long under macro pressures, as airlines, hotels, and travel agencies all fundamentally rely on the same consumer spending capacity.

Looking back, the global travel market over the past two decades was built on relatively stable assumptions: energy was stable, routes were smooth, and the world was predictable.

Now, these assumptions are gradually loosening.

Ticket price increases are just the most superficial signal; deeper changes include uncontrollable costs, unstable pathways, and uncertain decisions. When travel requires repeatedly weighing prices, risks, and uncertainties, the underlying logic of global travel has quietly changed.

The so-called “golden age” doesn’t usually end suddenly but gradually fades away amid a series of changes. Whether it truly becomes a thing of the past may still take time to determine.