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Last Updated: Wednesday, 31 March, 2004, 19:03 GMT 20:03 UK
US airlines scrap fuel surcharge
American Airlines aircraft
The airlines wanted to pass on costs to customers
US airlines, faced with soaring energy prices, have decided not to pass on the costs to their customers after all.

Several carriers have given in to consumer pressure, just days after announcing fuel surcharges.

American, Continental, United, Northwest and Delta airlines had initially wanted to introduce the $5 surcharges before this weekend.

But when competing budget airlines failed to follow suit, the major carriers were forced to rethink.

Expensive fuel

"We reversed the decision... for competitive reasons," said a Continental Airlines official.

Crude oil, which is used to make jet fuel, is trading at record levels well above $30 per barrel.

Earlier this month, US light, sweet crude stood at $38, its highest level in 13 years.

Energy prices are set to remain high as the oil producers' cartel Opec goes ahead with a cut in oil output on 1 April.

A reduction in the supply of oil would push prices higher.


SEE ALSO:
Opec to go ahead with output cuts
31 Mar 04  |  Business
Delta warning hits airline shares
15 Mar 04  |  Business
EU tackles US over airlines aid
12 Mar 04  |  Business


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