Fuel surcharge on most sectors to be removed for tickets issued from 1 May

Cathay Pacific updated yesterday (14 Apr) that it will axe fuel surcharge on most tickets, with few exceptions.

From 1 May, Cathay Pacific will remove fuel surcharges, better known as YQ within the industry, for all flights, except for select journeys from Japan and the Philippines. Note that this date applies for tickets issued from 1 May onwards, and not for tickets issued now for travel from 1 May.

The details

Cathay Pacific long had a fuel surcharge component that ranges around USD48.7 (~S$70) at present, with some exceptions.

From 1 May, all fuel surcharges will be removed, except the following:

For example, if you bought a ticket that starts from Tokyo to Sydney via Hong Kong, you will pay JPY2,000 (Tokyo to Hong Kong) + JPY7,300 (Hong Kong to Sydney) each way in fuel surcharge – and this will continue after 1 May.

Wait, what is fuel surcharge?

Fuel surcharge was a concept introduced back more than a decade ago when oil prices skyrocketed, so this gives airlines a bit of a cost relief by passing on these surcharges to the customers.

Over the years, oil prices have moderated itself. In many countries, airlines are also required by law to advertise all-in fares, and pricing strategies have also gotten more complex and so many airlines such as Singapore Airlines and Qantas have simply removed the YQ component of the fare and folded them into the base fare instead.

One Mile at a Time has a pretty long essay on fuel surcharge, which you can read more about here if you are interested.

What does this mean for customers?

In theory, this should mean you would be able to shave about USD48 (SGD70) off your fares per sector, but in reality you probably won’t feel a difference given that airlines have long been displaying ‘all-in’ fares, which will have these fuel surcharge included anyway.

The key target group who will feel the impact of this will be those using their miles for award tickets, they will typically have to fork out in cash any additional charges, including airport fees and fuel surcharges. With the removal of this charge, they will simply be paying just the airport charges in most cases.

Having said that, if you are using Asia Miles to redeem for other oneworld partner airlines such as British Airways who still has the fuel surcharges, these charges will still be passed on to you.