Australia's biggest airline Qantas Airways Ltd increased its fuel surcharges on tickets on August 23, but said the company would still face a A$650 million ($492 million) shortfall on its fuel bill. Qantas said that at current prices its fuel bill would rise by more than A$1.25 billion this year.
Oil prices on Tuesday rose towards A$66 a barrel on worries about continuing supply disruptions, while the cost of jet fuel traded in Singapore has jumped more than 40 percent this calendar year.
"The volatility of current and future oil and jet fuel prices is a serious issue for all airlines," Qantas Chief Executive Geoff Dixon said in a statement to the Australian Stock Exchange.
"Hedging and surcharges will continue to partially offset this significant cost. However we still face a A$650 million shortfall at current prices." Qantas increased its fuel surcharge by A$6 to A$26 on domestic tickets and by A$15 to A$75 on international tickets, following other airlines like British Airways Plc and Virgin Atlantic Airways who have also raised fuel surcharges.
Last week Qantas, which competes in the domestic market against budget carrier Virgin Blue Holdings Ltd, said its year net profit climbed to A$763.6 million ($579 million) from A$648.4 million for the previous year.
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