British Airways raises fuel supplement

British Airways passengers face another rise in fares after higher oil prices forced the airline to increase its fuel surcharges for the third time this year. Analysts expect other carriers to follow suit and hike up ticket prices.

The latest increase in the airline’s fuel surcharges, coming into force on tickets booked from this Thursday, follows similar moves by BA in April and June this year. The airline said it expects to pay an additional £136 million for fuel between now and April 2008.

BA, which carries 36 million passengers a year, faces a £2 billion annual fuel bill for the first time following record oil prices, which hit almost $100 a barrel recently. Passengers face an increase by £4 to £20 on short-haul flights, those under 9 hours will increase by £20 to £96 and on a flight of more than 9 hours, the fuel surcharge will increase by £30 to £116.

Robert Boyle, BA’s commercial director, said the cost of oil has reached record levels, rising by more than $20 (£9.68) a barrel since we last increased our fuel surcharge in June 2007.

KLM, the Dutch arm of Air France, Aer Lingus and Virgin Atlantic have also announced fuel surcharge increases due to spiralling oil costs.

Oil prices have risen to record levels due to supply concerns in the US, political tensions in oil-rich regions and increasing demand from emerging economies such as India and China. Furthermore, recent production stoppages in Mexico have also added to fears over supply.

Michael O’Leary, chief executive of Ryanair, recently said he would welcome higher oil prices so that his competitors might go bust.

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