BA hikes fuel surcharge again

BRITISH Airways has hiked its fuel surcharge to £48 for a return long-haul flight after further rises in the price of oil.

The long-haul surcharge will increase from £16 per sector to £24, with the short-haul price increasing from £6 to £8.

The price of a barrel of oil hit a record $60 yesterday, putting increased pressure on airlines and motorists at the pump.

BA rivals Virgin Atlantic and BMI are likely to follow the hike with surcharge increases of their own. A spokesman for Virgin said its current £16 per sector longhaul surcharge is 'under active review'. 'We have been reviewing it ourselves in recent days and will do so later this morning,' he said.

The rising price of oil will also put more pressure on low-cost carriers Ryanair and easyJet to introduce surcharges.

So far they have resisted but Ryanair boss Michael O'Leary has admitted the high price of oil could hammer the airline's profits.

'No airline can be immune to the increase in aviation fuel prices, said Kieran Daly, editor of the internet service Air Transport Intelligence.

He said: 'Some airlines are not imposing surcharges, but nevertheless an increase will simply feed through in way or another. It's virtually impossible to work out the mathematics of the whole thing. The whole price thing is not as transparent as it seems.'

BA commercial director Martin George said: 'We now expect our fuel bill for this financial year to be around £1.6bn. Our estimated fuel bill for this year will now be more than £450m higher than our fuel costs last year. This additional fuel surcharge will help to offset the recent sharp increases in the price of fuel.'

The airline said total revenues for the year to March 2006 are expected to grow by between 4.5% and 5%, rather than the 4% to 5% predicted at the airline's full-year results in May.

It is the fourth time BA has increased its surcharge since introducing a £2.50 per long-haul sector charge in May last year. The last hike was in March when the surcharge increased from £10 to £16.

The surcharge will only apply to tickets issued from Monday, so fares purchased over the weekend will pay the current £32.