Qantas Airways Raises First-Half Fuel Cost Forecast 4%, Expects Prices to Stay High

Qantas Airways raised its first-half fiscal-year fuel cost forecast by 4% on Friday, saying fuel prices are expected to remain high for the rest of the fiscal year. According to Sina Finance, the Australian airline expects fuel spending to reach A$3.75 billion in the six months ending December 31, A$150 million above the forecast issued with its annual results in August. Qantas said it has adjusted fares and capacity to address higher fuel costs and will continue doing so. Its fuel hedge ratio for the fiscal year is about 85%, mainly linked to Brent crude. Fuel hedging uses derivatives to lock in or limit future purchase prices, giving airlines greater certainty over this major expense. The airline expects full-year capital expenditure to be at the low end of its previous A$4.3 billion to A$4.6 billion range. It added that demand remains robust, as customers continue to prioritize travel.