Qantas cuts fuel levy but increases prices
Qantas has announced that it is cutting its fuel surcharge as a result of falling oil prices and resulting consumer backlash, but at the same time the airline has increased domestic ticket prices by 3%.
A report in The Australian said that Qantas denied that the increase was desinged to offest the cutting fuel surcharges.
With the cost of crude oil dropping over the last two months to a ten month low of $US58 a barrel, Qantas was criticised for failing to pass on savings to passengers, especially when other carriers, in particular international, including Singapore announced cuts of 10% off the levy from today.
Qantas’ fuel tax was introduced in 2004 and has been raised six times since the initial $6 for a one-way domestic fare and $15 for international, reaching $31 for each domestic leg and up to $196 for an overseas leg.
With the last levy increase introduced in August, immediately before the price of crude began to fall, John Borghetti Qantas Executive General Manager has said that fuel surcharges were under review and would be changed within a week.
Qantas low cost carrier Jetstar, has been charging a $24 fuel surcharge on domestic routes and Virgin $19 per domestic sector and $35 for each international sector.
Consumer criticism came about because the airlines levies did not change in line with falling fuel prices with airlines quick to increase the levy but slow to reduce it.
Report by The Mole
John Alwyn-Jones
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