Airlines yet to decide on new fares
Tony Hotland, Jakarta
Major Indonesian airlines have yet to decide on whether to charge passengers with new levy amid surging oil prices that are affecting the price of jet fuel.
Garuda Indonesia spokesman Pujobroto said the airline was currently evaluating the impact of the surging oil prices, as fuel was one of its main operating costs.
"We may increase fares, but not for the time being," Pujobroto told The Jakarta Post over the weekend.
Garuda bought jet fuel from state oil and gas company PT Pertamina and from foreign oil companies in countries that were Garuda destinations, he said.
"The jet fuel prices in several foreign countries have risen, but I don't know the exact details. However, as far as I know, Pertamina has not increased the jet fuel price," he said.
Merpati Nusantara general manager for corporate affairs Imam Turidy said management of the state airline also had no plans to increase fares yet.
"For now, we can assure (consumers) we're not thinking of rising our ticket prices since the impact (of surging oil prices) is still not significant. But we'll review the prices should the conditions get worse," Imam said.
Merpati would probably avoid passing the extra costs onto the consumer as long as the company's profit continued to rise.
"We're trying to improve our occupancy rate and we will try to subsidize the slack routes. If we really have to raise the fares, I can guarantee that it will be after a deep evaluation," he said.
Australian carrier Qantas, Air New Zealand, British Airways, and Malaysian Airlines have announced their plans to introduce surcharges on ticket sales -- a result of the highest global price for oil in more than a dozen years.
Pertamina spokesman Mohammad Harun said the company had yet to decide on whether to increase the jet fuel price and was still examining the situation.
"The two main factors that play a role in determining fuel prices are the oil price and the currency rate. Right now, the oil price is really high and our currency rate is weakening. We may increase the jet fuel price if this condition continues, but we must wait at least until the end of this month," he said.
Pertamina reviews fuel prices monthly and introduces new rates at the beginning of each month.
Oil prices have leapt above US$40 a barrel on concerns the Organization of the Petroleum Exporting Countries (OPEC) is not pumping enough oil to meet accelerating world demand.
The Indonesian rupiah has also weakened in the past several weeks against the U.S. dollar in line with losses in other regional currencies. The U.S. Federal Reserve's interest rate- hike plan and China's policy to slow the pace of its overheating economy are the underlying factors in the decline.