Airfares steady in Dec with fuel surcharge unchanged

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Airfares steady in Dec with fuel surcharge unchanged
The Civil Aeronautics Board left unchanged at Level 8 the passenger and cargo fuel surcharge airlines may impose for December. Image by JUNO KWON from Pixabay
  • Airfares will remain steady in December
  • This after the Civil Aeronautics Board (CAB) left unchanged at Level 8 the passenger and cargo fuel surcharge airlines may impose for the last month of the year
  • Level 8 fuel surcharge for passengers ranges from P253 to P6,208.98 for a one-way flight
  • For cargoes, Level 8 rates range from P1.30 to P31.92 per kg on a one-way flight

Airfares will remain steady in December as the Civil Aeronautics Board (CAB) left unchanged the passenger and cargo fuel surcharge airlines may impose from December 1 to 31, 2022.

The surcharge was kept at Level 8, the same as for November.

RELATED READ: Lower air fuel surcharges set in Nov

Airlines that wish to impose or collect the fuel surcharge for December must file their application with CAB on or before the effectivity period, with fuel surcharge rates not exceeding the stated level, according to an advisory dated November 20 signed by executive director Carmelo Arcilla.

For fuel surcharge to be collected in the equivalent currency, the applicable conversion rate for the period is $1 is to P58.72.

Under CAB Resolution No. 25, Level 8 rates for passengers range from P253 to P787 per one-way domestic flight, and from P835.05 to P6,208.98 per one-way international flight.

For cargoes, Level 8 rates range from P1.30 to P3.80 per kilogram (kg) on a one-way domestic flight, and from P4.29 to P31.92 per kg on a one-way international flight.

CAB issued in May CAB Resolution No. 25, which provides the revised policy on fuel surcharges that now includes a matrix for cargo. The fuel surcharge matrix ranges from Level 0 to 20.

Resolution No. 25 revises Resolution No. 46 (passenger fuel surcharge for domestic and international flights adopted in June 2021), which was reviewed and evaluated by CAB this year in light of the steady increase in jet fuel prices on the global market and the foreign exchange rate.

CAB said the review showed fuel surcharges were applied only to passengers, who are a component of a combination service (passenger and cargo operations).

Resolution No. 25 said a cargo fuel surcharge matrix may be provided given that the volatility of jet fuel prices also affects cargo operations as a component of a combination service wherein cargo is carried in the belly-hold capacity of a passenger aircraft.

Under the new policy, the applicable fuel surcharge will be determined based on a one-month average of jet fuel Mean of Platts Singapore prices in the peso per liter equivalent and will be fixed for the immediately succeeding month. This will be the ceiling rate for fuel surcharge.

The applicable fuel surcharge will be evaluated every month and announced 15 days prior to its effectivity. Previously, the applicable fuel surcharge was determined based on a two-month average and implemented for two months.

Resolution No. 25 notes that airline fuel surcharge is an optional fee that airlines may impose and collect to recover fuel costs and stem losses caused by a spike in fuel cost.

“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,” the resolution said.

If the one-month average price of jet fuel per liter falls below P21, no fuel surcharge will be collected.

The passenger fuel surcharge level in effect on the day of ticketing should be applied, and should be the same for all passengers, excepts infants without seats. The applicable surcharge should be collected per passenger and per segment.

For cargoes, the fuel surcharge should be applicable only for cargo carried in the cargo hold of an aircraft used for combination services. Such cargo must be covered by an airway bill.

Cargo fuel surcharge should be collected based on the actual weight (as opposed to chargeable weight) carried per segment. Cargo fuel surcharge should not be levied on a passenger’s check-in baggage.

For international flights originating in the Philippines, the fuel surcharge may be imposed in any equivalent foreign currency. – Roumina Pablo