The Civil Aeronautics Board (CAB) has reduced the level of fuel surcharge that airlines are allowed to impose, following the lowering of jet fuel prices in the international market.
CAB Executive Director Carmelo L. Arcilla said the regulator has lowered the fuel surcharge level from Level 12 to Level 9 for domestic and international flights between September 1 and September 30.
The reduction in fuel surcharge stems from the agency’s monitoring of jet fuel prices between July 10 and August 9. Average jet fuel prices reached P46.73 per liter, lower than the previous month’s P54.73 per liter.
Under Level 9 of the passenger fuel surcharge matrix, airlines are allowed to impose fuel surcharge rates between P287 and P839 for domestic flights, and between P947.30 and P7,044.27 for international flights.
“Airlines wishing to impose or collect fuel surcharge must file its application with this office on or before the effectivity period, with fuel surcharge rates not exceeding the above-stated level,” Arcilla said.
Fuel surcharge is an optional fee imposed and collected by airlines to recover fuel costs and stem losses caused by upward spike in fuel costs. It is not part of the basic fare and is reduced or even removed depending on the market prices of jet fuel.
Data from the International Air Transport Association showed jet-fuel cost was at $305.26 per barrel as of August 5, still 65.1-percent more than the year-ago price, but is 12.3 percent lower than the month prior.
Fuel accounts for over 60 percent of the expenses of carriers.
Philippine Airlines (PAL) Spokesperson Cielo C. Villaluna said the airline views the reduction in fuel surcharge as a positive development.
“We welcome this positive development and we will carry out the corresponding adjustments in our fuel surcharges. The new fuel surcharge rate will be applicable to tickets that will be purchased in September,” she said in a text message.
AirAsia Philippines Spokesperson Steve F. Dailisan added that this will provide relief to travelers, especially those who wish to fly during the start of the Christmas season in the Philippines, a period that typically begins in September.
“This will benefit many of our guests who are now planning their travels in time for the ‘ber months,” he said.
Cebu Pacific Chief Commercial Officer Xander G. Lao echoed this sentiment, noting that the lower costs for passengers will help stir up demand for travel.
“This is a welcome development. We look forward to the lower fuel surcharge which should help make fares more affordable and stimulate air travel,” he said. Lorenz S. Marasigan