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As Oil Prices Surge,[link widoczny dla zalogowanych], So Do Airfares
As the price of oil has surged because of the unrest in the Middle East,[link widoczny dla zalogowanych], so have airline fares.Airlines around the world are quickly boosting their fares to keep pace with higher jet fuel costs,[link widoczny dla zalogowanych], which account for 30 percent of the carriers' operation expenses. The price of oil has risen sharply as the turmoil in oil-producing states like Libya has traders worried that the world's daily flow of oil will be diminished.
Some U.S. air carriers have already raised fares six times this year,[link widoczny dla zalogowanych], topping the four price hikes for all of last year. Now, U.S. business travelers are paying about $100 more per round trip than a year ago, while fares for leisure travelers are up by $40 to $60. U.S. airlines have also boosted fuel surcharges on overseas flights to Paris,[link widoczny dla zalogowanych], Frankfurt and other European destinations from $360 to $400.
Chinese airlines have also increased their fuel surcharges for passengers, as have airlines in the Ukraine,[link widoczny dla zalogowanych], Britain and Canada.Even as air carriers increase their fares, the airline industry says its profits will erode this year. The industry's main trade group (the International Air Transport Association) says airlines overall had net profits of $16 billion in 2010. But now the industry is predicting that with the higher fuel costs the figure will fall 46 percent this year to $8.6 billion.
Some airlines have been able to limit airfare increases because they bought jet fuel at cheaper prices,[link widoczny dla zalogowanych], before the recent jump in oil prices that now have reached $115 a barrel for crude oil on the London market and more than $104 in New York.But the industry says that for each dollar more for a barrel of oil it has to pay,[link widoczny dla zalogowanych], the airlines' costs increase by $1.6 billion.
Obama Seeks Congressional Partnership on US Budget
President Barack Obama says with unemployment at a two year low and jobs being added to the economy,[link widoczny dla zalogowanych], he is appealing Congress to help keep the economic momentum going.During his weekly address Saturday,[link widoczny dla zalogowanych], Mr. Obama stressed that the same bi-partisan teamwork that led to tax cuts needs to continue in order to reach an agreement on the federal budget.
The president says the only way his administration and Republicans can reach a common ground is if they sit at the same table and work out their differences.Mr. Obama says both Republicans and Democrats must come work together in putting the country on a sustainable course that creates jobs,[link widoczny dla zalogowanych], and prepares our citizens better than anyone else in the world.
In the Republican weekly address, Tennessee Congresswoman Diane Black said that while Mr. Obama talks about the country living within its means, his budget just represents more out of control government spending.Representative Black say the country needs a new approach that removes barriers to job growth, which she identified as over-regulation,[link widoczny dla zalogowanych], taxation, and debt.
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