LAHORE: As no airline, including the Pakistan International Airlines (PIA), has shown any intention of cutting fares, air passengers travelling to and from Pakistan may not benefit from the lowest oil prices in six years. Crude oil prices have plummeted to $46 per barrel – a 55 per cent fall since last June, primarily because of rising global supplies and weak demand.
The airlines see the oil price decline as a golden opportunity to ‘recover their earlier losses’, market sources. PIA spokesman Hanif Rana said the airline has reduced fares on some routes, especially on European destinations, by up to 20pc. But travel agents counter this claim, saying these are usual off-season discounts PIA was in any way constrained to give to maintain reasonable passenger traffic. On the contrary, PIA increased fares on some Gulf and domestic routes recently. The increase in Umra ticket prices has been substantial, exposing it to flak from intending pilgrims.
The PIA source said an estimated 5.5 million people travelled on international and domestic flights of the national flag carrier last year. The estimated number of those who travelled by foreign airlines is over 8m and those who used Pakistan-based private airlines is 1.5m.
An expert said, “Fares go up when there is an increase in oil prices in the international market — which doesn’t mean they would come down when oil prices fall,” he says. “And which sector in the country has provided any relief to people in the wake of the falling oil prices? The case of the airlines is no different. The International Air Transport Association – a global body which regulates international air transport – is concerned about cartelisation but it has no say in rationalising air fares.”
