Sat, Jan 22, 2011 - Page 11 News List

Singapore Airlines raises fuel charges on rising oil prices

AFP, SINGAPORE

Singapore Airlines (SIA) yesterday announced additional fuel surcharges as a result of rising world oil prices and hinted that the cost of flying on the airline could rise further.

The increases will also apply to its regional wing, SilkAir, and range from US$3 to US$27 depending on the distance and class of travel.

“Singapore Airlines will increase its fuel surcharges for tickets issued on or after Jan. 27, as a result of the recent sharp and sustained escalation in the price of jet fuel,” it said.

The adjustment “will offer only partial relief from the higher operating costs arising from increases in the price of jet fuel,” SIA said, adding it would continue to closely monitor oil price movements and “keep surcharges under constant review.”

Jet fuel is now above US$110 per barrel, the firm added.

It was SIA’s second increase in fuel surcharges since Dec. 2, when jet fuel prices were above US$95 per barrel.

Before last month, the last increase was in June 2008. There were three fuel surcharge cuts — in September 2008 and November 2008 and in February 2009, the carrier said.

“It’s a good sign that SIA is reacting quickly because the trend is that oil prices are inching higher,” said Shukor Yusof, an aviation analyst with Standard & Poor’s Equity Research.

SIA needs to raise fuel surcharges as oil prices increase because, “as a tier-one airline, it costs a lot more to produce the products that they have on board compared to other airlines,” Shukor said, adding that SIA’s entire fleet is made up of big planes.

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