Qantas Responds Again to Higher Fuel Prices

Sydney, 09 March 2011

Qantas announced today it would again increase international fuel surcharges as a further response to continuing rises in oil and jet fuel prices. The changes will apply to tickets issued on or after 17 March.

Qantas Chief Executive Officer, Mr Alan Joyce, said oil and fuel prices remained an increasing concern for the aviation industry

"Due to a range of factors, including political instability in the Middle East, prices have moved upward sharply in recent months," Mr Joyce said.

"This prompted, last month, our first increase in international fuel surcharges since January 2008, as well as modest increases in domestic, regional and Tasman fares of up to five per cent.

"Since then, jet fuel prices have increased by a further 12 per cent, to more than US$131 per barrel today.

"This increased cost to our capital intensive business is something we, and other airlines, have to manage very carefully via hedging activities as well as surcharge and fare increases.

"The increases today will still not recover the full impact of these latest oil and fuel price rises.

"Fuel costs for the Qantas Group in the second half of this financial year are now expected to rise to $2 billion."

For tickets issued on or after 17 March, the new fuel surcharges (A$ one way ex-Australia) will be:
- UK and Europe - $190 (new) $145 (previous)
- Mainland USA, Canada, South America, South Africa and India - $150 (new) $115 (previous)
- Asia, Pacific, Honolulu - $105 (new) $75 (previous)

Year to date average prices for both Brent and Singapore Jet Fuel are at their highest since FY08, and second half FY11 prices are forecast to be around 20 per cent higher than in the first half. The price of Singapore Jet Fuel has increased from an average of US$88 a barrel in September 2010, to US$120 a barrel in February, and is more than US$131 per barrel today.

Mr Joyce said Qantas would continue to closely monitor oil and fuel prices and respond accordingly.

"Our international surcharges and domestic, regional and Tasman fares remain under review, and further increases will be considered if necessary," he said.

Issued by Qantas Corporate Communication (5085)