Due to falling oil prices, budget airline Cebu Pacific announced Tuesday it would remove fuel and insurance surcharges on all Asian flights starting Wednesday, February 18.
In an interview with ABS-CBN News, Cebu Pacific president and chief executive Lance Gokongwei said the move would cut the carrier's fares by as much as 17 percent.
"Expect costs to go down significantly because fuel targets are going down. Oil is our single biggest input," he said.
Last January 7, Cebu Pacific dropped the fuel and insurance surcharges on all its domestic flights to encourage higher passenger volume amid the economic downturn.
Gokongwei said, "our corporate accounts have increased as businesses look to cut costs using budget airlines."
Gokongwei noted that while 2008 was a difficult year for the company, 2009 would be "substantially better" because of lower oil costs.
Cebu Pacific has earmarked $60-$70 million for capital expenditures this year, much lower than the $200 million it allotted last year.
Meanwhile, flag carrier Philippine Airlines (PAL) has reduced its fuel surcharge by as much as $38 on selected international flights from Manila.
In a statement, PAL said that it started implementing the adjustment last February 14.
"The last in a weeklong series of surcharge reductions takes effect on February 20," PAL said without providing details on the surcharge rates.
"The latest surcharge reduction is being applied on each one-way ticket from Manila to selected international destinations," it added.