Melburnians are putting off plans for a European summer as jet fuel prices surge to record highs and popular flight paths through the Middle East remain no-go zones.
Local travel agents say new bookings have cratered to lows last seen during COVID times, as the war in the Middle East drags on and Gulf cities that typically account for about 50 per cent of stopovers on long-haul flights between Australia and Europe are bombarded.
Iran’s blockade of shipping lines through the critical Strait of Hormuz has also contributed to a near doubling of the price of aviation fuel, which some airlines are beginning to pass on to customers by raising fuel surcharges.
Those who are committed to European travel face economy fares as high as $6000 return, and are turning in never-before-seen numbers to Chinese carriers that fly over Russian airspace, agents say.
Nigel Walliss, director of Balwyn-based agency Travelrite International, said people were being cautious about making new travel plans, while those with existing bookings are anxious to avoid the Middle East.
“We’re just in the middle of a storm at the moment, and it is very quiet as far as new inquiries, though we’re obviously busy making changes for clients,” Walliss said.
“It is traditionally a busy time of year with people planning their European summer holidays. It’s been a drastic reduction in inquiries and bookings.”
Walliss said the agency expected demand to bounce back strongly when the Middle East conflict was eventually resolved.
One independent travel agent in Melbourne’s eastern suburbs who declined to be named said overseas bookings had dried up completely.
“We’ve really had no new bookings for a couple of weeks,” the agent said. “Everyone’s saying the fares are ridiculous, and then obviously there’s the cost of living and the interest rate rise. So we are just reworking stuff, not really booking anything new. For us as agents, it feels very like COVID.”
The average price of jet fuel almost doubled in the two-week period between February 27 and March 13, peaking at $175 a barrel, according to the International Air Transport Association. The association’s long-term data indicates prices have reached a record high.
Airlines have begun to increase fuel surcharges in response.
A Virgin Australia spokesperson said aviation costs were rising, and this was “significantly exacerbated by the situation in the Middle East. We are making necessary fare adjustments to reflect these cost pressures,” the spokesperson said.
Qantas has said it will review its international fares each fortnight, having already raised fares for overseas travel earlier this month due to “volatility in jet fuel prices” caused by the Middle East conflict, according to a company statement.
Airlines typically spend almost 30 per cent of their operating budget on fuel, the International Air Transport Association says.
North Fitzroy travel agent Emma Whiting said it was still possible to find an affordable fare to Europe if a client was prepared to be flexible.
Economy return fares to Europe are selling from anywhere between $2000 and $6000, depending on routes and airlines.
“People obviously are trying to get on to things that are more direct. So once you start doing that, yes, you’re going to probably pay more.
“But if you’re actually a little bit more flexible, and you can change dates around and those sorts of things, you’ll probably still be able to get a reasonable price there,” Whiting said.
Australian Travel Industry Association chief executive Dean Long said its surveys of travel agents indicate that most travellers are changing their travel plans rather than cancelling journeys outright.
The number of weekly flights from Australia to the Middle East has been cut from more than 150 to about 50, with Emirates the only airline offering commercial flights to the Gulf.
The Australian government has advised against travelling to most Middle East states.
Long said the cost of long-haul flights to Europe had skyrocketed, but Australians’ enthusiasm for overseas travel meant many were looking elsewhere, such as Asia.
“There is no drop-off in overall sentiment for travel. Destinations are changing, but they change all the time,” he said.
Jetstar and Flight Centre were contacted for comment.
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Adam Carey is senior city reporter (suburban). He has held previous roles including education editor, state political correspondent and transport reporter. He joined The Age in 2007.Connect via X or email.