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Date: 04/03/2011

Controversial fuel surcharges to rise higher with BA-Iberia

With the crisis in the Middle East continuing to gain momentum, concerns over oil shortages are pushing the price ever upwards. BA and its associated carrier airline, Iberia, are set to increase fuel surcharges even higher according to a statement by the group's chief executive.

Fuel surcharges, introduced in the 1970s are frowned upon by consumer watchdogs and are seen as a hidden and unnecessary charge for passengers. With many travellers on a budget, even for those making just a single trip travel insurance and other crucial extras soon add up so hidden expenses such as fuel surcharges are seen as unnecessary and costly.

BA's boss, Willie Walsh said that the volatility in the market meant that fuel prices would inevitably be rising presenting a 'challenge' to the industry. Mr Walsh went on to disclose BA's fuel bill, which in 2010 totalled around £3.3 billion but was expected to rocket during 2011 to £4.3 billion.

However, the increase in BA's fuel bill will come as little comfort to passengers, with many opting to try and make savings in other areas of the bill such as taking out single trip travel insurance, which is cheaper in the short-term, but more expensive in the long-term for frequent fliers.

Another cost saving many may be tempted to make is taking out a standard insurance policy rather than a more specialised product, such as backpacker travel insurance. The backpacker travel insurance packages and other tailored insurance products are designed to more specifically meet the needs of travellers not visiting other countries on a standard holiday package but can be more expensive as they tend to be more comprehensive.

BA also announced healthy pre-tax profits for the last quarter of 2010, compared to losses announced for the same period in the previous year, news not likely to be received well by passengers facing further price hikes.