The Price of Kerosene and Its Impact on Airfares and Consumer Rights

Kerosene is one of the key cost factors in the aviation industry. As a specially refined aviation fuel derived from crude oil, it accounts for a significant portion of airlines’ total operating costs. According to data from the International Air Transport Association (IATA) , this share stood at around 26.8 percent in 2025.

Fluctuations in the price of jet fuel therefore have a direct impact on airlines' financial situation—and an indirect impact on ticket prices as well.

Breakdown of the Airfare

The price of an airline ticket consists of several components. In addition to the base fare itself , it also includes taxes, fees, and charges paid to third parties such as airports or government agencies. In addition, many airlines charge a so-called fuel surcharge. This was originally introduced during periods of sharply rising kerosene prices, but today it is often included as a fixed component of the ticket price.

Retroactive price increases on airline tickets

Under Austrian law, the fare agreed upon at the time of booking and payment is generally binding.

A retroactive price increase—for example, due to higher fuel prices—is generally not permitted for individual tickets that have already been booked (individual trips).

An exception could arise only if the airline includes a valid price adjustment clause in its General Conditions of Carriage (GCC). However, such clauses are subject to strict legal requirements. Under Section 6(3) of the Consumer Protection Act (KSchG), unclear or incomprehensible contractual provisions are invalid.

Furthermore, a clause may be deemed invalid under Section 879(3) of the General Civil Code (ABGB) if it places the consumer at a significant disadvantage. The courts apply a strict standard in this regard, which is why such clauses rarely hold up in practice.

Special provisions for package tours

The situation is different for package tours. Section 8 of the Package Travel Act (PRG) contains an explicit provision that allows for price adjustments after the contract has been concluded under certain conditions. These include, among other things, increases in fuel costs.

This provision constitutes a legal exception to the principle of fixed pricing. However, it is contingent upon a corresponding price adjustment clause having already been validly agreed upon in the package tour contract. Furthermore, clear limits apply: a price increase is permitted only up to 8% of the tour price. For increases exceeding this limit, the consumer has the right to cancel the contract free of charge. Furthermore, price adjustments are not permitted within the last 20 days before the start of the trip.

Cancellation and Denied Boarding

In practice, airlines may respond to rising costs by canceling flights or refusing to transport passengers who refuse to pay surcharges imposed retroactively.

In such cases, the EU Air Passenger Rights Regulation (EC) No. 261/2004 applies. Whether, for example, a cancellation due to a kerosene shortage constitutes an “extraordinary circumstance”—and thus exempts the carrier from the obligation to pay compensation—has not yet been definitively clarified and depends on the specific circumstances of each case.

If a passenger is denied boarding because they refuse to pay a surcharge that is not legally required, this generally constitutes denied boarding within the meaning of the Regulation. In such cases, claims for compensation may also arise.

The legal situation shows that consumers are well protected in many cases against retroactive price increases—especially when booking flights only. Nevertheless, the specific circumstances of each individual case are decisive, particularly when assessing contract terms or exceptional circumstances.

Passengers facing retroactive claims, flight cancellations, or denied boarding should have their case Agency for Passenger Rights by the Agency for Passenger Rights .

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