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Air fares to rise on costlier crude
Published on 3 Feb. 2011 12:39 AM IST
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Surging crude prices are making flying more expensive. A number of international airlines have hiked fuel surcharge in the last week by Rs.500 to Rs.2,000 per sector, making flying abroad costlier. While this is the range for economy fliers, business and first class passengers would have to shell out much more. Domestic full service airlines had hiked their fuel surcharge last month. They are expected to announce new hikes after oil PSUs increased jet fuel prices on Tuesday.
“On an average, the hike in fuel surcharge (one-way) is Rs.500 to Gulf; Rs.1,000 to Europe and Rs.2,000 to America. These hikes have been brought in force from January 25 and Tuesday by different airlines,” said Anil Kalsi, chairman of Travel Agents Federation of India (TAFI).
According to Times report, airlines like Air France, KLM, Delta, Malaysian Airlines, Cathay Pacific hiked their surcharge from Tuesday, while others like Lufthansa and Singapore Airlines did so last week. According to TAFI, the average return fares from Delhi to places like London, New York and Hong Kong is Rs.40,000, Rs.55,000 and Rs.60,000 respectively. Now the fares to these cities would rise by Rs.2,000, Rs.4,000 and Rs.1,500, respectively.
The recent hikes mean a double blow for passengers as air fares are anyway much higher than last year. “Demand has grown by 20% and fares are 15-25% higher than same period last year. Now fuel surcharge has risen for economy and business class passengers by up to Rs.10,000 and higher for first class. So far there is no impact on travel. But if crude keeps getting hotter, than one can’t say how things unfold,” said Benson Samuel, director of Delhi-based Riya Travels.
With crude touching $100/barrel, jet fuel price in Delhi shot up to $846.7 per kilolitre (kl) for international airlines, rising from $689 last July. The price for domestic airlines at Delhi is now Rs.50,958.8 per kl - the highest since October, 2008. The highest price ever - Rs.71,028 per kl - was recorded in August, 2008.
Fuel accounts for about 40% of the total operating cost of airlines, which rises when jet fuel prices go up. For passengers, this would only mean skyrocketing fares.

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