Airlines still not reducing fuel surcharges

Hotel News - 25/09/2008

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As the cost of jet fuel increased to record levels earlier this year, many air carriers were forced to increase fuel surcharges during the early summer to combat the rising costs – which by July had skyrocketed to $147 per barrel.

When oil prices had dropped to the $90 per barrel level last week, however, The Telegraph noted that few airlines had taken steps to reduce the surcharges they had imposed when oil prices were at all-time highs.

Throughout the summer, British Airways added surcharges incrementally as the cost of jet fuel increased, but as prices have come down the surcharges have remained at their July levels. For example, the fuel surcharge per person on a long-haul, return fare is £218.

Virgin Atlantic has imposed similar levies, and even though oil prices dropped to the $90 per barrel level last week, the surcharge is much higher than the £116 charge that was added when oil was last at that price level.

A BA spokesman defended the carrier’s position, explaining: "Although the spot price of oil has dropped in recent weeks, the market remains volatile. Our overall fuel bill, which is paid for in dollars, has not reduced."

Critics have pointed out, however, that British Airways World Cargo has cut fuel surcharges three times since fuel prices peaked during the summer, citing when it did "the recent drop in fuel prices."

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