Just when travel restrictions are easing up, airfares are expected to further increase this summer due to a higher fuel surcharge to be imposed by the air regulator as jet fuel prices continue to rise in the global market.
In a February 15 advisory, Carmelo Arcilla, Civil Aeronautics Board (CAB) executive director, said the fuel surcharge for domestic and international flights effective March 1, up to April 30, 2022, is at level 4. This was at level 3 from January 1 to February 28.
The fuel surcharge for March up to April is based on the average jet fuel price of $95.34 per barrel from December 2021 to January 2022, with the US dollar exchange rate at P50.75 during the period.
This is equivalent to P30.43 per liter which corresponds to level 4 of the passenger fuel surcharge matrix.
CAB asked the airlines to file an application if they intend to collect fuel surcharge during the period.
The fuel surcharge is an optional fee imposed and collected by airlines to recover fuel costs and steam losses caused by an upward spike in fuel cost. Fuel surcharge is not 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.
Based on the passenger fuel surcharge matrix, at level 4, the fuel surcharge imposed in domestic flights per passenger, per way ranges from P108, P175, P235, P315, P368 and P411 for 0 to 200 kilometers, 201 to 400 km., 401 to 600 km., 601 to 800 km., 801 to 1,000 km., and more than 1,001 km., respectively.
For intentional flights, the fuel surcharge per passenger costs P543 up to P5,189 per way for regional flights and US and Europe flights, respectively.
CAB suspended the collection of fuel surcharge in 2020 due to the severe impact of the pandemic on the airline sector.
This was reimposed initially at level 1 in July and August 2021, then raised to level 2 in September up to December last year.
Published by the CAB every 12 months, the fuel surcharge matrix is revised as necessary.
Surcharges are suspended once the price of average jet fuel falls below P21 per liter.
With the easing of travel restrictions for fully vaccinated passengers, local airlines are optimistic to resume operations in both domestic and international flights this year.
