Virgin Australia to join Qantas and hike prices to cope with fuel crisis

By MATT JONES, SENIOR NEWS REPORTER, AUSTRALIA Published: 02:10, 15 April 2026 | Updated: 02:28, 15 April 2026 Virgin Australia has followed Qantas and will lift the prices of some airfares to offset rising fuel costs. Aussies will also have fewer flights to choose from as Qantas and Virgin deal with the impact of the war in Iran. Virgin Australia will reduce its capacity by one per cent over the next four months and Qantas will temporarily suspend five per cent of domestic flights. Virgin Australia claims fuel costs make up around 21 per cent of total costs as they use about 3.4million barrels of oil in the first half of 2026. Jet fuel prices have more than doubled since the war started on February 28, and Virgin Australia has predicted that the increase in fuel costs will be as high as $40million above previous estimates. 'Virgin Australia's fuel suppliers continue to provide assurances regarding the near-term supply of aviation fuel to support its operations well into May 2026,' the airline said in a statement. Virgin's wet lease arrangement, where one airline provides an aircraft, complete crew, maintenance, and insurance to another airline, with Qatar Airways, has been cancelled until mid-June. 'As previously disclosed, the wet lease arrangement minimises the risk to Virgin Australia's balance sheet and earnings and therefore is not financially material,' the statement said. Virgin Australia customers will have to pay more for a flight as the war in Iran impacts fuel costs Virgin Australia will reduce its capacity by one per cent over the next four months The news follows a warning by Qantas 24 hours earlier in which it predicted fuel will cost between $3.1billion to $3.3billion for the second half of the financial year. That's up at least $600million compared with previous estimates. 'The group continues to closely monitor the dynamic environment and retains optionality to take further actions to mitigate fuel cost increases over time,' Qantas said in a statement. Qantas claims jet fuel refinery margins blew out from $US20 ($A28) to $US120 (A169) a barrel. 'The group is working closely with the government and jet fuel suppliers who continue to provide confidence in fuel supply for the remainder of April and well into May,' Qantas said. 'We are closely monitoring the situation given the ongoing uncertainty in global fuel supply chains.' Affected Qantas and Jetstar passengers will be contacted and offered refunds or alternative flights. Daily Mail contacted Qantas and Virgin Australia for further comment.   The comments below have not been moderated. The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline. By posting your comment you agree to our house rules. Do you want to automatically post your MailOnline comments to your Facebook Timeline? Your comment will be posted to MailOnline as usual. Do you want to automatically post your MailOnline comments to your Facebook Timeline? Your comment will be posted to MailOnline as usual We will automatically post your comment and a link to the news story to your Facebook timeline at the same time it is posted on MailOnline. To do this we will link your MailOnline account with your Facebook account. We’ll ask you to confirm this for your first post to Facebook. You can choose on each post whether you would like it to be posted to Facebook. Your details from Facebook will be used to provide you with tailored content, marketing and ads in line with our Privacy Policy.