Iran triples fuel price for international flights

Business Materials 13 January 2013 16:16 (UTC +04:00)

Azerbaijan, Baku, Jan. 13 / Trend F.Mehdi/

Iran has increased the price of fuel for international flights by 14,200 rials ($1.1) to 21,200 rials ($1.7), a triple rise within a week, The Jomhouri Eslami daily reported.

"The U.S. has been trying to ground the Iranian civil aviation industry for thirty years, but they could not. Instead, the Iranian administration grounded the industry within a week through increasing fuel prices by 14,200 rials," Mohammad Hassan Aboutorabi-Fard, deputy speaker of Iran's Majlis (parliament), commented.

The rise in the fuel prices will lead to a growth in costs of airlines as well as a multiple rise in ticket prices, an official a an Iranian airline told the Jomhouri Eslami daily.

The recent 60-70 percent increase in Iranian airlines ticket prices have caused a 50 percent fall in the number of passengers, according to the Mehr News Agency.

On January 7, many domestic flights were cancelled because the Nation Iranian Oil Products Distribution Company (NIOPDC) had not provided the airlines with fuel due to their outstanding debts.

NIOPDC says the airlines owe 5 trillion rials (about $410 million) to the company. The airlines believe that rising fuel prices has increased their costs up to 300 percent.
Iranian airlines increased ticket prices for domestic flights by 65 percent averagely as of November 6, 2012.

That's why the director of the Civil Aviation Organization Hamid Pahlavani announced on October 10 that Iranian airlines will be increasing ticket prices for domestic flights by maximum 50 percent.

Pahlavani added that different factors, including foreign currency prices, are considered to set the ticket prices.

The managing director of the Airtour passenger airline said in October that the airline has suffered 200 billion rials (some $16 million) loss as the administration will no longer provide the airline with dollar at reference rate of 12,260 rials. Therefore, the airline cancelled all its international and tourism flights, ILNA reported.

As the administration does not provide the airline with official-rate dollar, the airline has to pay costs based on the free market dollar, Sirous Baheri noted.
International sanctions on Iran have hindered the process of repairing passenger planes in the country, IRNA quoted managing director of Iran's national air carrier (Iran Air), Farhad Parvaresh, as saying in December 2012.

Periodical checking of the planes may be prolonged due to the lack of certain parts, but there is no plane grounded, he added.

For the time being, Iran Air operates 47 planes with a total 10,500 seats, he noted.