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CAB approves higher fares for foreign and domestic flights

The Civil Aeronautics Board issued guidelines and matrix for the reimposition of airline fuel surcharge amid costlier jet fuel prices. 

The CAB said in a resolution the fuel surcharge for passengers of one-way domestic flights would range between P34 and  P769, while those flying overseas would be charged P163 to P9,680, depending on the destination and the prevailing jet fuel prices. 

“The applicable fuel surcharge will be determined based on the two-month average of jet fuel MOPS prices in its peso per liter equivalent, and will be fixed for two months,” the CAB said. 

“If the two-month price average of jet fuel per liter falls below P21, no fuel surcharge will be collected,” it added.

Data from CAB showed that jet fuel prices went up by 25 percent to $85.16 per barrel in April from $63.66 a barrel in the same period last year. 

“Airline fuel surcharge is an optional fee, imposed and collected by airlines to recover fuel costs and stem losses caused by an upward spike in fuel cost,” CAB said. 

The agency said fuel surcharge is not a part of the basic airfare and may be reduced or removed depending on the price of jet fuel in the market, in accordance with prevailing international practice. 

It said jet fuel cost is the largest expense by an airline operator and as a global practice, airlines, “due to competition prefer to charge fuel surcharge separately rather than increase fares when fuel prices surge.” 

The CAB resolution, which will take effect immediately, said that infants without seats are exempt from the fuel surcharge.

The CAB suspended the imposition of fuel surcharge in all domestic and international flights in 2015 because of lower jet fuel prices. 

Cebu Air Inc., the company behind Cebu Pacific, earlier asked the CAB to approve a fuel surcharge amounting to P70 to P280 for domestic flights and $6 to $26 for international flights. 

Philippine Airlines asked the CAB to approve P282 worth of fuel surcharge each way for Luzon to Luzon and Visayas routes; P405 for Luzon to Mindanao routes; and P158 for Visayas to Visayas routes. 

PAL seeks to impose a fuel surcharge of P222 for Mindanao to Visayas/Mindanao routes. 

Topics: Civil Aeronautics Board , CAB , jet fuel prices , foreign and domestic flights
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