Air New Zealand CEO says airline planning around $150/bbl Singapore jet fuel going into FY27

Air New Zealand is preparing for a continued high-cost fuel environment, with its CEO indicating that the airline is planning for jet fuel prices of approximately $150 per barrel, based on Singapore jet fuel benchmarks, through the fiscal year ending 2027. This projection follows a sharp increase in fuel prices over the past 10 weeks, which have surged from around $85–$90 per barrel to as high as $230 per barrel, driven by geopolitical tensions and global market volatility.

The airline has already experienced a $240 million headwind to its full-year results due to higher-than-expected fuel costs, with second-half fuel expenses now projected at $980 million, up from earlier forecasts of $740 million. Air New Zealand has accelerated cost-cutting initiatives, identifying up to $100 million in annualized savings to mitigate the impact of rising fuel prices. These measures are part of a broader strategy refresh initiated in late 2025 and are expected to provide financial relief in FY27 and beyond.

The carrier has also noted that improved fleet availability, particularly with its Boeing 787 aircraft, will enhance operational efficiency and reduce carrying costs. Despite these efforts, CEO Nikhil Ravishankar has acknowledged that the airline is only recovering about 40% of the increased fuel costs through fare adjustments and network optimization. The airline continues to monitor the evolving fuel market and adjust its operations accordingly.