Air NZ lifts fares as cost of fuel soars
5:00AM Wednesday November 14, 2007
By Grant Bradley
Air New Zealand has pushed up international economy fares by up to $50 as soaring fuel prices hammer airlines around the world.
Passengers on Air New Zealand now pay $10 more each way on transtasman and Pacific routes and around $50 more on long-haul economy fares as world oil prices near historic highs.
All airlines have been pummelled by rising aviation fuel prices which cause costs to rise by around US$500 million globally for every US$1 increase in the price of oil.
While oil fell to US$94.45 a barrel yesterday, Opec is likely to announce this weekend that production will not be increased, suggesting oil prices are likely to stay around US$100 a barrel.
British Airways announced yesterday it was raising its long haul ticket prices by up to $40 to cover fuel costs and in the past week KLM Royal Dutch Airlines and Lufthansa have announced fare increases of around $20 on intercontinental flights. Air New Zealand, which also blames fare rises on increased airport charges and labour costs, said every US$1 increase in oil prices adds another US$11 million to running costs.
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