Solon to CAB, airlines: No need for fuel surcharge amid oil price drop

INQUIRER FILE PHOTO

MANILA, Philippines–Hoping for cheaper airline tickets? A lawmaker said lower ticket prices are possible if passengers are no longer asked to pay fuel surcharge.

LPG-MA Representative Arnel Ty on Saturday urged the Civil Aeronautics Board (CAB) to abolish the practice of adding fuel surcharge to the prices of airline tickets.

Airlines are allowed to collect fuel surcharge as an extra fee shouldered by the passenger as a way to recover losses due to rising fuel costs.

“To allow passengers to enjoy lower airfares, the CAB should eliminate the fuel surcharge mechanism. Better yet, it should be replaced with a fuel discount scheme that will compel airlines to automatically lower fares as oil prices go down,” he said in a statement.

He pointed out that there is no need for the surcharge since world oil prices continue to go down.

Ty said oil prices already fell below $60 per barrel from $107 in June this year.

“The multinational financial services firm Morgan Stanley projects that oil prices will fall further to as low as $43 per barrel by the third quarter of 2015,” he added.

Ty, a member of the House transportation committee, said fuel surcharge, depending on the airline and the flight route, may cost around P500 for local passengers and up to $400 (P18,000) for international passengers.

The solon said the abolition of the fuel surcharge system will benefit overseas Filipino workers (OFWs). He said about 5,000 OFWs fly out of the country daily while the volume of domestic passengers is expected to reach 21 million this year.