Air France said Thursday it is removing its latest fuel surcharge — cutting ticket prices by as much as €14 (US$20.22) — in response to the falling price of oil. Air France said it is reacting to a “significant period” of falling oil prices. Crude has dropped about US$38, or 26 percent, since surging to a record US$147.27 a barrel on July 11, as a U.S. economic slowdown spreads overseas and curbs demand for petroleum products.

The airline said it is cutting the fee on domestic flights by €2 (US$2.89) from Friday, reducing the fuel-linked extra charge to €19 (US$27.44). Medium-haul flights will be €4 (US$5.78) cheaper and the cost for long-haul flights will fall between €10 (US$14.44) and €14 (US$20.22), the airline said.

When the airline announced the latest surcharge on July 8, it promised to withdraw it when the oil price stabilized below US$125 (€86.6) a barrel. The airline raised its fuel surcharges repeatedly in recent years as oil prices mounted. Thursday’s announcement was the first time it has announced a cut in the surcharge.

Source : International Herald Tribune