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Airlines to raise fares to counter fuel costs
By Cao Zhe (China Daily)
Updated: 2005-07-27 06:03

Jet fuel prices have been rising from 3,400 yuan (US$410) per ton early last year to its current 4,620 yuan (US$558) per ton.

The three major airlines Air China, China Eastern Airlines and China Southern Airlines made a joint appeal to the CAAC in May to allow them to collect a fuel surcharge.

A 1 per cent increase in jet fuel prices means a 42.45-million-yuan (US$5.23 million) rise in the company's yearly transport costs, Luo Dewei, financial director of Shanghai-based China Eastern Airlines, was quoted by the Xinhua News Agency as saying.

Air China and Hainan Airlines hailed the policy change as "good news." Airlines are also under pressure as jet fuel is controlled by a monopoly the Civil Aviation Oil Corporation of China.

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