ANA, JAL Eyeing Return Of Fuel Surcharges On Higher Oil Prices

TOKYO (Nikkei)--All Nippon Airways Co. and Japan Airlines Corp. will likely bring back fuel surcharges in October to reflect higher oil prices.

ANA and JAL reassess such surcharges every three months. Owing to a downslide in crude oil prices from last summer, the airlines sharply reduced their surcharges this past January and April. And they eliminated such charges altogether from July.

The October-December surcharges will be based on the average price of jet fuel during the May-July period. As of July 14, the average price of kerosene in the Singapore market, a benchmark for jet fuel prices, stood at 70.7 dollars a barrel, above the 60 dollar threshold at which the surcharge kicks in. As a result, the airlines are likely to bring back the surcharge to help soften the brunt of their rising costs.

"We are currently exploring the possibility of charging (the fees) from October," ANA President Shinichiro Ito said at a news conference Wednesday.

JAL is also said to be considering a similar move.

Previously, the airlines had charged 7,000 yen to 14,000 yen on round-trip tickets for flights connecting Japan with Europe and the U.S. and 1,000 yen to 3,000 yen for Chinese routes. ANA, however, is unsure about whether to charge the same fees again.

"Because the elimination of surcharges helped fuel travel demand, we are still giving it thought," said Ito, suggesting that the airline might implement a different fee structure.

(The Nikkei July 23 morning edition)