15th November 2018
Established 1872. Online since 1996.

Air fares should be reduced, says Scott

The dramatic fall in worldwide oil prices should result in lower air fares, Shetland MSP Tavish Scott said this week.

He is contacting Loganair to ask when fares will fall as airlines have much lower fuel bills for aircraft in 2015 then last year.

Mr Scott said worldwide crude oil prices had fallen from $110 a barrel in September 2014 to below $60 at the moment. Petrol prices were falling every day and Shetland motorists had seen a notable saving in fuel prices in recent weeks. He is now asking for cuts to the high cost of air tickets for Shetlanders.

Mr Scott said: “Shetland garages have reflected falling oil prices at local petrol pumps. Good for them.

“Everyone in Shetland benefits from falling oil prices as we all need a car or a bus to get around. We are still very much in winter and people are also noticing the cost of filling domestic fuel tanks for heating is falling too. Shetland has very high fuel poverty so price reductions are good news.

“But I have seen no difference in the cost of flying. Why has Loganair and other airlines not cut ticket prices reflecting their savings in fuel bills? All the airlines walloped passengers with fuel surcharges in past years.

“These were fuel cost rises passed on to passengers. We have now seen four months of steadily falling oil prices. Why therefore have the airlines not reflected that in ticket prices?

“Shetlanders still pay full fare tickets of £400 plus to get to the Scottish mainland. Loganair also get the Air Discount Scheme money that cuts ticket prices by 40 per cent. So it is time that these savings were passed on to island travellers. I expect Loganair to reflect the reality of oil prices in their air tickets.”

But Loganair said it had not “walloped passengers with fuel surcharges in past years”.

“In fact no fuel surcharges have been applied by Loganair since 2006.

“The recent and dramatic reduction in oil prices was completely unforeseen.  Loganair, in common with most airlines, manages the risk of fuel price changes by purchasing its fuel up to one to two years in advance.

“At a time of falling prices this can unfortunately mean that the airline does not see the benefit of falling prices for an extended time.

“An additional factor is that fuel prices are in US dollars.  With the recent decline in sterling against the dollar this has had an impact on the final price in sterling.”

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