Air Malta yesterday announced it will be raising its fuel surcharge as from July 1, due to the increase in international fuel prices.
The surcharge on all Air Malta scheduled routes will increase by €5 per sector, with the exception of flights to Catania, Palermo, Reggio and Tunis which will see an increase of €2. The surcharge on flights to Rome, Milan, Bologna, Venice, Naples and Tripoli will increase by €3.
Air Malta’s fuel surcharge will now range between €11 per sector for the shortest routes to €25 per sector for its longer routes.
The airline said that up to last year, its fuel bill almost doubled over the past three years: an increase of €30 million in spite of fuel hedging agreements which the airline had successfully managed to conclude in the past.
The airline said will be incurring a further €32 million increase in its fuel costs.
Crude oil is at present expected to breach the $140 per barrel mark.
The airline said its fuel surcharge was last revised in November 2007 when crude oil prices were around $80 per barrel.
The new additional rate will still not cover 15% of the increase in annual fuel costs expected for this year.
CEO Joseph Cappello said the airline will be meeting the shortfall through further cost reductions and new opportunities for revenue growth.
The International Air Transport Association (IATA) forecasts a loss of $2.3 billion for 2008 based on an average oil price of $106.5 per barrel Brent crude. The association sounded a warning that this year’s loss could be even higher – potentially $6.1 billion with an oil price at $135 per barrel for rest of the year.