Airlines raise fuel surcharges by up to 50%

Chinese airlines won approval from regulators to raise fuel surcharges on domestic flights to help offset high oil prices, Reuters reported. Regulators approved a higher surchage of US$11.67, up from US$8.75, for flights of 800 km or less, and US$21.87, up from US$14.58, for longer distances. The increases will begin today. China’s big airlines, Air China, China Eastern Airlines and China Southern Airlines have been seeking permission from regulators for a surcharge increase. However, according to one analyst who spoke to the South China Morning Post, the surcharges will only cover about 66% of the airlines’ increased fuel costs. The air transport industry has forecast a loss of US$2.3 billion this year if crude oil averages US$107 a barrel. Oil prices rose to about US$143 a barrel yesterday.