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Taiwan Airlines to Raise Levies over Higher Fuel Price
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China Airlines and EVA Airways Corp, Taiwan's two largest carriers, will increase fuel surcharges on overseas flights by 17 percent starting July 16, because of a rise in the price of jet fuel, Bloomberg said today.

 

Taiwan-based airlines will raise surcharges on short-haul flights, including to Hong Kong, to US$17.5 each way from US$15, Taiwan's traffic department said on its Website yesterday. The levy on flights to the US and Europe will rise to US$45.5 each way from US$39.

 

Jet fuel, the biggest expense for Asian airlines, has surged 17 percent this year to US$84.85 per barrel in Singapore yesterday. Worldwide fuel spending by carriers may rise about 6 percent to US$119 billion this year, according to the International Air Transport Association, which represents more than 250 airlines.

 

China Airlines, Taiwan's largest carrier, has cut its proportion of fuel hedging to 20 percent from 60 percent a year ago, because ``volatile'' prices have made the cost of the contracts riskier than buying jet kerosene on the spot market, company Chairman Philip Wei said in May.

 

Hedging allows airlines to lock in prices for fuel, their biggest single expense, to protect against possible increases.

 

(Shanghai Daily July 4, 2007)

 

 

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