Indonesian Airlines Suddenly Request Increase in Airfare Prices

The national aviation industry is facing heavy pressure amid global economic turbulence. The association of airlines under INACA assesses that the current conditions no longer align with the applicable cost structure, necessitating fare adjustments to ensure operational sustainability.

External pressures are said to be intensifying. Global geopolitical conflicts are the primary factor driving economic uncertainty, particularly through spikes in energy prices and exchange rate fluctuations.

“Furthermore, considering the current aviation industry conditions, namely the influence from the geopolitical conflict between the US-Israel vs Iran, which has made international economic conditions unconducive,” INACA stated in its release on Wednesday (25/3/2026).

The direct impact of these conditions is the rise in global oil prices and the weakening of the rupiah exchange rate against the US dollar, two major components in airlines’ cost structures.

“These conditions have resulted in an increase in global oil prices and the weakening of the rupiah against the US dollar, where both cost components significantly affect the rise in operational costs for national airlines,” it explained.

INACA noted that the trend of cost adjustments has actually been implemented by many global airlines. Some have even added substantial fuel surcharges.

“Currently, many airlines in various countries are adjusting operational costs by adding fuel surcharges between 5% and 70%,” INACA revealed.

This cost pressure is also reflected in the surge in exchange rates and fuel prices. Compared to the time of setting the upper fare limit in 2019, the rupiah exchange rate has now weakened by more than 20%.

“In 2019, the average was Rp14,136 per USD, whereas in March 2026 it has reached Rp17,000 or an increase of more than 20%,” INACA wrote.

Additionally, global oil prices have also surged dramatically, directly impacting domestic avtur prices which continue to climb.

“Global oil prices have risen from 70 USD per gallon to 110 USD per gallon or an increase of 57%, while avtur prices in Indonesia are now in the range of Rp14,000 to Rp15,500 per litre,” it continued.

With these various pressures, INACA believes that fare adjustments cannot be avoided. An official request has been submitted to the government to adjust cost components in the aviation industry.

“Increasing the fuel surcharge by 15% as well as raising the Upper Fare Limit (TBA) by 15% for jet and propeller aircraft is the measure we propose,” INACA wrote.