AirAsia to impose fuel surcharge today

Tuesday, 3 May 2011 00:00 - - {{hitsCtrl.values.hits}}

Southeast Asia’s largest budget carrier AirAsia said Friday it will impose fuel surcharges beginning today, 3 May, to offset escalating jet fuel prices.

In February, AirAsia Chief Executive Officer Tony Fernandes said the carrier would only consider imposing a ticket surcharge if the New York crude futures contract hits 100 dollars a barrel.

On Friday in Asian trade, New York’s main contract, light sweet crude for delivery in June fell 30 cents to $ 112.56 per barrel while jet fuel, which trades at a premium, exceeded $ 140 per barrel.

“The rising jet fuel prices and the continuous upward spiral... have made it imperative for us to reintroduce the fuel surcharge, despite our best efforts to resist it for as long as we could,” the airline’s Regional Commercial Head Kathleen Tan said in a statement.

“While other carriers were already adjusting fares and increasing fuel and admin charges... when jet fuel price went above $ 100 per barrel on 2 March this year, the strong growth of our ancillary income has helped us delay the implementation of fuel surcharge for as long as possible,” she added.

AirAsia’s fleet is made up of fuel-efficient new Airbus A320 and A340 aircraft. In 2008, after the last major spike in energy prices subsided, the carrier abolished fuel surcharges on all its flights.

Earlier this month, British Airways said it would lift its fuel surcharge for long-haul flights for the second time this year following surging oil prices.

Global oil prices have jumped to two-and-a-half-year highs due to the continuing unrest in Libya and positive economic data in the United States, which is the world’s biggest consumer of crude.

Last November AirAsia said its net profit for the July-to-September quarter rose to 327.29 million ringgit (62.89 million dollars) from 130.07 million ringgit in the same period a year earlier.