CAB to nix airlines’ fuel surcharge

MANILA, Philippines—Travelers may find themselves paying for cheaper airline tickets next year as the government is moving forward with an unprecedented plan to “scrap” fuel surcharges, saying these are no longer required because oil prices are falling globally.

Civil Aeronautics Board (CAB) executive director Carmelo Arcilla confirmed in an interview on Tuesday a decision to remove the surcharge on fuel for “all international and domestic airlines with operations in the Philippines, effective immediately.”

Arcilla said the exact timing would depend on when a final resolution is signed but he said the removal of the surcharge could take place in early 2015. The move would result in lower ticket prices as the fuel surcharge can run into the hundreds of US dollars for long-haul international flights.

Brent crude oil has declined over 46 percent since June and expectations were for this slump to continue, reports overseas showed.

“This surcharge is imposed by airlines to cover volatile price levels of fuel like upward spikes. Because of the significant reduction in fuel prices, there is now no more basis for the surcharge,” Arcilla said.