CAB downgrades fuel surcharge level for January 2023

The Civil Aeronautics Board (CAB) has lowered the fuel surcharge level in January next year following the drop in the price of jet fuel.

Air travelers should expect lower airfares in January as the Civil Aeronautics Board downgrades the fuel surcharge level next month to Level 7 from Level 8 in December. pic.twitter.com/BCFhV9YJgJ

— Ted Cordero (@Ted_Cordero) December 15, 2022

In an advisory on Thursday, CAB Executive Director Carmelo Arcilla announced that the fuel surcharge for January 1 to 30, 2023 was lowered to Level 7.

During the agency’s monitoring period for November 10 to December 9, the price of jet fuel averaged P41.50 per liter, “which corresponds to Level 7 of the Passenger and Cargo Fuel Surcharge Matrix.

The fuel surcharge level for January 2023 is a notch lower than the current level.

Under Level 7, passengers will be charged P219 to P708 fuel surcharge for domestic flights and P772.71 to P1,124.26 for international flights, depending on the flight distance.

Meanwhile, under the current Level 8, the fuel surcharge for domestic passenger flights ranges from P253 to P787 depending on the distance of the flight.

For international passenger flights originating from the Philippines, the fuel surcharge ranges from P835.05 to P6,208.98.

“Airline 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,” Arcilla said.

In a statement, AirAsia Philippines spokesperson Carlo Carongoy said the CAB’s decision to lower the fuel surcharge level next month “is a welcome development for both AirAsia Philippines’ guests and the airline itself.”

“This initiative helps all airline companies to cushion the effects of the volatile fuel pricing and the weakening value of the peso versus the US dollar,” Carongoy said.

The AirAsia official said that the low-cost carrier remains committed to provide its passengers with “best value deals that will allow them to travel more during the holidays.”

From December 12 to 18, Carongoy said AirAsia is having its 12.12 Sale which offers P112 base fare to domestic destinations and P412 for international destinations. 

“All these efforts are proven to be effective in terms of sustaining the pent-up demand for air travel as reflected in the forward bookings for 0-90 days. In fact, the load factor for the month of December is now at 90% and still increasing,” he said.

Cebu Pacific, likewise, welcomed the fuel surcharge level downgrade.

“This decrease in fuel surcharge for January 2023 is a welcome development, especially as we see a continuous increase in passenger traffic and forward bookings. We are excited to offer even lower fares for everyJuan,” Xander Lao, Cebu Pacific chief commercial officer, said. 

Flag carrier Philippines Airlines (PAL), for its part, said the development “will increase travel appetite and boost air travel.”

“We welcome the lowered fuel surcharge which will apply to tickets purchased in January 2023 since it will ease the financial effects to consumers brought about by fuel surcharges,” PAL spokesperson Cielo Villaluna said.

The PAL official said the lowering of fuel surcharge levels is coming in at a time when the airline is expanding its flight route network, mounting new flights, and restoring its flight capacity to pre-pandemic levels.

“We have restored flights between Cebu and Bangkok, opened the Cebu - Baguio route , and  Cebu - Cotabato. Soon, we will operate flights to Borongan via Cebu. By early next year, we are opening a Manila - Perth service thus expanding our Australia route network,” Villaluna said.

“We are on track in the restoration of our  flights - which is now at 90% of pre-pandemic levels,” she added. — RSJ, GMA Integrated News