Korean Air to shift to emergency mode in April amid rising oil prices

Korean Air will enter emergency management ​mode from April as rising oil prices driven by ‌the war in the Middle East weigh on costs, a source with knowledge of the matter told Reuters on Tuesday. The airline said in an ​internal memo reviewed by Reuters that if high oil prices ​persist, it expects significant disruption to its annual business ⁠targets, and will shift to an emergency operating system from ​April. The memo added that the airline plans to implement phased response ​measures based on oil price levels, and step up company-wide cost efficiency to offset surging fuel costs.

T’way Air and Asiana Airlines have also entered emergency ​management mode this month amid rising fuel costs, according to local ​media reports, underscoring the broader strain on South Korea’s aviation industry. Korean Air said ‌it ⁠expects fuel costs for April to rise to around 450 U.S. cents per gallon, significantly higher than the 220 U.S.

cents per gallon cited in its business plan, a sharp increase in ​its monthly cost ​burden. Fuel surcharges for ⁠flights departing from South Korea in April are also set to jump, with fares on Incheon ​to New York and Incheon to Chicago routes ​rising by ⁠more than 200%, while surcharges on Incheon to London and Incheon to Paris routes are expected to increase by nearly 250%, according ⁠to ​Korean Air’s website. Korean Air shares were trading ​down 1.9%, compared with the benchmark KOSPI’s (.KS11), opens new tab 1.9% fall at 0251 GMT.