Philippines hikes fuel surcharge, pushing up ticket prices in early August

Dubai: Air travellers flying within and out of the Philippines will pay higher ticket prices during the first half of August after the Philippine Civil Aeronautics Board (CAB) raised the allowable passenger fuel surcharge from Level 8 to Level 13.

The increase, which takes effect from August 1 to 15, allows airlines to collect higher fuel surcharges on top of the base airfare to help offset rising aviation fuel costs.

Higher fuel surcharge 

Under Level 13, airlines may collect fuel surcharges ranging from ₱423 to ₱1,237 for domestic flights, depending on the distance travelled.

For international flights departing the Philippines, the surcharge ranges from ₱1,396.74 to ₱10,385.42, also based on flight distance.

In comparison, the current Level 8 surcharge, which applies from July 16 to 31, ranges from ₱253 to ₱787 for domestic flights and ₱835.05 to ₱6,208.98 for international services. 

The higher surcharge means passengers booking flights during the August 1 to 15 period are likely to see an increase in the overall cost of their tickets, particularly on longer international routes.

Airlines must seek CAB approval

The CAB has noted that airlines intending to impose the higher fuel surcharge must first secure approval from the regulator.

“Airlines wishing to impose or collect fuel surcharge for the same period must file its application with this office on or before the effectivity period, with fuel surcharge rates not exceeding the above-stated level,” wrote CAB in an advisory.

The regulator has also mentioned that the application form for authority to impose the fuel surcharge can be downloaded from the official CAB website.

What is a fuel surcharge

A fuel surcharge is an additional fee that airlines may collect separately from the base airfare to help recover costs arising from fluctuations in aviation fuel prices.

The surcharge is regulated by the CAB, which reviews and adjusts the allowable levels based on prevailing fuel prices.

The board has been implementing a 15-day price monitoring and implementation cycle for passenger and cargo fuel surcharges to help mitigate the impact of fuel price volatility on air travel costs.

Interim measure 

According to CAB, the current pricing mechanism will continue until market conditions improve.

“This interim measure shall be in effect until the current situation stabilises, or as may be revised or revoked accordingly,” read the advisory.

For fuel surcharges collected in foreign currencies, the regulator has set the applicable conversion rate at $1 to ₱61.65. 

The exact surcharge depends on the distance of the flight and is charged in addition to the base airfare and other applicable taxes and fees.