Scoot today announced plans to adjust its fares network-wide in response to rising jet fuel price, which has surged almost 40% year on year and now stands at close to US$90 per barrel on average.
Generally, Scoot’s fares will increase by between S$5 and S$30 per sector, depending on flight duration. Across the network, fares will increase by about 5% on average. The fare increase will take place from 1 September 2018.
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With fuel comprising on average 32% of Scoot’s total operating costs, the rise in jet fuel prices have pushed up Scoot’s fuel expenditure by 31% year on year.
Back in March 2016, Scoot had removed fuel surcharges from its fare structure as fuel prices sank to six-year lows.
Besides increasing fares, Scoot is also looking at containing its costs. Some initiatives being considered include exploring ways to reduce fuel burn, review of suppliers’ contracts and measures to improve productivity and keep manpower resources lean, among others.