Irish airlines clash in oil surcharge row
This followed the State-owned airline’s decision to slap a €35 each way surcharge on long-haul flights, starting on May 15.
Ryanair condemned the move as a €42 million yearly “rip off” by Aer Lingus of its passengers.
Ryanair chief Michael O’Leary vowed his company will not hit any of its routes with such a charge. He also condemned the claim by Aer Lingus that it could not absorb the costs on long haul routes.
Earlier this week, British Airways introduced a passenger surcharge of €50 on all of its long-haul flights, blaming rising fuel costs for the hike in travel charges.
Yesterday US light crude fell 29 cent to $73.40 but that is still close to the record high hit by Brent crude in London on Thursday, when the price per barrel hit $74.22.
Market analysts attributed the modest price dip to nothing more than investors taking some profit.
Paul J Harris of Bank of Ireland Global markets has warned oil prices could hit $82.30 in the near term as the grave uncertainty about future oil and gas supplies pushes prices higher.
In real times today’s prices would need to hit $150 per barrel to match the levels achieved during the last oil crisis back in 1979, said Niall Dunne, Ulster Bank economist.
The prospect of reaching that figure has not been ruled out, as the US squares up to Iran.
US president George W Bush has vowed to stop Iran getting atomic weapons and has hinted strongly that the military option, including nuclear strikes, could be deployed if diplomacy failed.
As the fourth largest oil producer, any disruption of supplies out of Iran would have a devastating impact on oil prices.
Even before the tensions over Iran’s nuclear capability surfaced, some international experts warned prices could hit $100 if supply constraints were not addressed.
One significant problem is oil refining capacity has not increased much in recent years despite continuing growth in demand.
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