(Reuters) -Shares of Australia's Qantas Airways ( QUBSF ) rose over 5% on Monday to a one-month high, tracking a drop in oil prices after OPEC+ signaled faster output hikes.

Oil prices fell over $2 a barrel after OPEC+ agreed to boost output for a second straight month, despite sliding prices and weakening demand expectations. [O/R]

Jet fuel is a key cost for airlines, and falling prices raise hopes for improved profitability. Qantas spent A$5.32 billion ($3.44 billion) on fuel in fiscal 2024, up nearly 17% from the previous year.

"Investors (are) anticipating that weaker energy prices will spell good news for the airline's profits," said Tim Waterer, chief market analyst at brokerage KCM Trade.

The drop in fuel costs offers relief as Qantas faces intense competition from Virgin Australia, which is gearing up for an initial public offering later this year.

Qantas and its budget arm Jetstar held about 65% of Australia's domestic market as at December-end, while Virgin had a 35% share, data from Australia's competition regulator showed.

Qantas' stock had last risen to A$9.27, marking their biggest single-day gain since April 23.

($1 = 1.5470 Australian dollars)

(Reporting by Sneha Kumar in Bengaluru; Editing by Nivedita Bhattacharjee and Mrigank Dhaniwala)