UAE travellers face sharp rise in airfares: What’s driving the spike?

Dubai: In just over a month, the global aviation industry has undergone a dramatic shift, with airfares climbing sharply across major routes, including from the UAE.

What was once a relatively stable pricing environment has become volatile, as airlines grapple with rising fuel costs, reduced capacity, and longer flight paths due to the US-Israel war on Iran. With the Hormuz Strait essentially shut down, matters have been complicated even further.

According to the International Air Transport Association, “fuel costs have risen sharply. With tight capacity and thin margins, air fares are already rising.” So what’s making ticket prices so expensive?  

The ongoing conflict has led to widespread airspace restrictions across parts of the Middle East, forcing airlines to reroute flights through designated “safe corridors”.

These longer routes are increasing flight times and operational costs, particularly fuel burn — the single largest expense for most carriers.

Saj Ahmed, Chief Analyst at StrategicAero Research, said, “While GCC airlines are slowly ramping up flights, they are nowhere near frequency or capacity versus where they were on February 27 when the war commenced.”

He added, “This is a combination of jet fuel prices rising owing to supply issues and the longer, re-routed flights to safe corridors means that airlines have no choice but to increase fares to try and claw back both lost revenue and offset their higher cost of operations.”

The surge in ticket prices is closely tied to jet fuel costs, which have spiked dramatically.

According to IATA, fuel prices in the region have risen by more than 130 per cent month-on-month — a significant shock to airline economics, where fuel typically accounts for around 30% of operating costs.

Ahmed notes, “On average, fuel costs account for almost 30 per cent for airlines, and with the conflict restricting supply and the resultant choke in flights, this cost element has to be addressed.”

With the Strait of Hormuz effectively closed, oil shipments remain disrupted, further tightening supply and keeping prices elevated.

The impact of rising costs and reduced capacity is already evident in ticket prices from the UAE, with fares climbing sharply across both long-haul and regional routes.

For travel between April 11 and 18, flights from Dubai to major global destinations such as London and Bangkok are priced at Dh3,560 and Dh3,360 respectively, while fares to Shanghai and Hong Kong have crossed Dh4,000.

Travel to the United States has become significantly more expensive, with Dubai–New York tickets at Dh4,890 and Dubai–Chicago reaching as high as Dh9,000.

Regional routes, particularly to South Asia, have seen some of the steepest increases. A Dubai–New Delhi ticket now costs around Dh2,293, compared to roughly Dh800 during off-peak periods earlier, highlighting the scale of the surge.

Other routes such as Dubai–Lucknow (Dh2,525), Abu Dhabi–Delhi (Dh1,795), and Sharjah–Mumbai (Dh1,330) are also reflecting elevated pricing. The sharp rise across these high-demand expatriate corridors underscores how constrained capacity and higher operating costs are feeding directly into ticket prices.

Indian carrier IndiGo has already begun passing on part of these rising costs to passengers, signalling what could become a broader industry trend.

The airline announced revised fuel surcharges effective April 2, with GCC and Middle East routes seeing additional charges of INR 3,000 (approx. Dh117.85) for flights up to 2,000 km and INR 5,000 (Dh196.42) for flights above 2,000 km

The airline said the move was necessary to offset rising operational costs, particularly fuel. For UAE travellers on busy routes such as Dubai–Mumbai or Abu Dhabi–Delhi, this is expected to push ticket prices higher, especially amid already strong demand.

IndiGo is not alone. U.S. carrier JetBlue has raised its checked-bag fees by up to $9 due to the war.

The upward trend in airfares is not limited to the UAE and the rest of the Middle East; global markets are witnessing similar pressures.

Data cited by Investopedia, based on Deutsche Bank analysis, shows that domestic airfares in the United States have increased by between 15 per cent and 124 per cent for travellers booking later this month.

Transcontinental fares have roughly doubled compared to pre-war levels, while transatlantic one-way tickets now average more than $1,000.

Even before the crisis, airlines were operating at high load factors, with February figures reaching a record 81.4 per cent.

Now, with fewer flights and altered schedules, the imbalance between supply and demand is pushing prices even higher.

Ahmed highlights the uncertainty ahead: “The real challenge is yield and demand. Will people be put off by premium fares? Almost certainly. Scale, though, is difficult to pinpoint.”

While airlines may be able to ramp up operations quickly once restrictions ease, pricing may not normalise as fast.

Ahmed warns, “Despite the summer season approaching, it’s likely that these high fares are here to stay.”

He adds that even if the conflict ends soon, concerns about future instability could continue to influence airline planning and pricing strategies.