FSVT reports that fuel prices are now accounting for 60% of Russian airlines operating costs

Published: 12/8/1999

The FSVT has reported that the continuing increase in jet fuel costs, with consequent rises in ticket prices, is continuing to undermine passenger volume. According to Vladimir Andreev, Head of the FSVT, jet fuel costs have risen from 15-18% of total operating costs at the beginning of 1999 to 50-60% at the end of the year. The FSVT predicts that Russian airlines will carry nearly 21m passengers in 1999: a 6% decrease on 1998. The number of international passengers is expected to decrease by 15% in 1999, compared to the previous year. However, the FSVT also forecasts a rise of 8% in domestic passenger traffic, suggesting a real post-crisis recovery. Last year, domestic routes were hit even harder than international routes. In addition, the FSVT anticipates that Russian airlines could lease up to 200-300 Russian-manufactured aircraft through to 2005. Andreev claims that these will comprise the Il-96, Tu-204 and Tu-334, all of which can fly internationally. Associated articles: www.concise.org. 26th October 1999

Article ID: 1191