Rex axes 26 weekly flights in Victoria and Tasmania as fuel costs bite

Rex Airlines announced 26 weekly flight cancellations across its Victoria and Tasmania network on Thursday^[1], citing rising jet fuel costs and softer demand. North-West Tasmania routes are among those reduced^[2], the airline said in its operational update.

The cuts mark the first major schedule retraction by Rex since the carrier emerged from voluntary administration in December 2025 under new American ownership. They also extend a pattern that has now claimed services from three Australian carriers in four months.

What is changing

Twenty-six weekly services are being pulled from the Victoria and Tasmania network. The Sunraysia Daily reported Rex is reducing Mildura-Melbourne returns from 24 to 19 per week as part of a larger restructuring^[3]. Rex said reduced frequencies will apply on its Melbourne-Devonport, Melbourne-Burnie and Melbourne-King Island corridors, although a full route-by-route schedule has not yet been published.

The Advocate, the local masthead for North-West Tasmania, reported that the airline was blaming soaring fuel prices and "volatility" for the decision^[2]. Tasmanian tourism operators previously told the masthead they had "no confidence" thin Bass Strait routes could be sustained, when Sharp Airlines pulled its Melbourne-King Island service in February.

Why fuel is the trigger

Australia's jet fuel position has tightened sharply across 2026. ABC News reported in March that Australia was holding less than one month's worth of jet fuel^[4], citing The Australian's aviation writer Robyn Ironside. Globally, the International Air Transport Association estimates the jet fuel price shock will lift industry fuel costs roughly US$222 billion above 2021 levels^[5].

Ironside said in March that domestic carriers would be forced to cut services if jet fuel prices kept climbing^[6]. On Qantas's earlier regional cuts she told Sky News the changes were "not good news at all" and described them as "a blow to customers"^[7].

Qantas has already gone first

Qantas ended Adelaide-Mount Gambier flights in April 2026^[8], citing the same combination of fuel costs and low demand. Adelaide Now reported that the cancellation left the regional South Australian town with one airline serving it. Virgin Australia has also pulled flights in recent months, according to The Australian.

Sharp Airlines axed its Melbourne-King Island route in February^[9], with Pulse Tasmania reporting the carrier had stopped selling tickets beyond April for the route.

Rex back under pressure

Rex collapsed into voluntary administration on 30 July 2024, with Ernst & Young appointed as joint administrators. Air T, a US-listed airline holding company, completed its purchase of the business in December 2025, ending a 17-month administration process.

Earlier this year Canberra CityNews reported that Rex executives had "promised profit" in periods before plunging to a $35 million loss, with ASIC noting the airline's optimism had been "unreasonable" given its compressed timeline^[10]. The Tasmanian government had subsidised parts of the regional network during the administration to keep Bass Strait routes flying. Whether those arrangements have continued under Air T ownership has not been disclosed by either party.

What happens next

Affected passengers will need to rebook or seek refunds through Rex's customer services channels. The airline has not announced a date by which the cuts will be reviewed.

The federal Department of Infrastructure, Transport, Regional Development, Communications and the Arts oversees the Regional Aviation Access Programme that subsidises certain remote routes. A spokesperson for the Department has not yet responded to requests for comment on whether any of the Rex cuts affect subsidised services.