Loganair to add fuel surcharge to most routes due to soaring oil prices

Scottish airline Loganair has announced a £3.95 fuel surcharge on most flights because of soaring oil prices.

The charge will be added to tickets bought from Monday, March 21 and not apply to existing bookings.

It will not apply to routes between Glasgow and Barra, Tiree and Campbeltown, Dundee-London City, Derry-Stansted, and flights within Orkney, Shetland and the Western Isles, which are protected by “public service obligations”.

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The Glasgow-based airline said it had been “simply impossible” to absorb the impact of the energy price hike, but pledged to reduce or remove the charge if oil prices fell back.

Loganair chief executive Jonathan Hinkles said it had been "simply impossible" to absorb the oil price rise. Picture: Loganair
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Chief executive Jonathan Hinkles said: "The economic consequences of the war [in Ukraine] are being felt keenly across the airline industry, given the very significant rise in worldwide fuel prices in recent days.

Loganair has already fixed the price for over 50 per cent of its expected fuel volume for the 12 months from April 1, using financial hedging instruments.

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"For the remainder of our fuel volume, the rise in global oil prices equates to an additional cost of £4.7 million in the coming year at today’s oil price.

"It is simply impossible for us to absorb this impact, especially where airlines including Loganair still face significant uncertainty over the pace of recovery in passenger numbers from the pandemic.

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“We’ve realistically no option, but to introduce a fuel surcharge on new ticket sales from March 21.

"Many other international airlines have already taken this step.

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“Although it will be unwelcome, I trust this represents a transparent response to worldwide circumstances which is preferable to an opaque, and permanent, increase in basic air fares.”

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The surcharge of £3.95 per one-way journey will apply on all new bookings made on routes, save for routes flown under public service obligations.

Brent crude oil reached $129 a barrel on Wednesday before falling back to $110 on Thursday.

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Mr Hinkles said if the price of Brent crude oil fell below $110 per barrel for six consecutive weeks, the surcharge would be halved.

If it fell below $85 per barrel for six consecutive weeks, it would be removed.

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