May to June domestic and international flights from the Philippines will not come with a passenger fuel surcharge.
In an advisory dated April 15, Civil Aeronautics Board (CAB) executive director Carmelo Arcilla said that from February to March 2020, jet fuel averaged US$51.66 per barrel, equivalent to P16.51 per liter at an exchange rate of P52.82 per dollar. This average is way below the $76.86 per barrel, equivalent to P24.56 per liter at an exchange rate of P50.80 per dollar during the December 2019 to January 2020 period.
The latest jet fuel average falls within Level 0 of the passenger fuel surcharge matrix for domestic and international flights.
The matrix is encapsulated in CAB Resolution No. 44 issued in September 2018. Resolution No. 44, which reimposes the collection of fuel surcharge from passengers on domestic and international flights, states that the applicable fuel surcharge shall be determined based on the two-month average of jet fuel Mean of Platts Singapore (the average of a set of Singapore-based oil product price assessments published by Platts) priced in its peso-per-liter equivalent, and will be fixed for two months.
The two-month price average shall be the ceiling rate for the fuel surcharge.
The applicable fuel surcharge shall be evaluated every two months and announced 15 days prior to its effectivity, in accordance with the timetable in Resolution No. 44.
Resolution 44 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 adds.
