Middle Eastern carrier Emirates is going on the offensive over the continuing issue of subsidies, starting with an outright rejection that it benefits from lower fuel costs.
Emirates has been defending itself against suspicion, notably from other carriers, that its governmental ties bring unfair cost advantages. In its latest in-house publication the carrier says it will shortly be distributing a "comprehensive document" which will respond to "decades-old allegations of subsidies".
But recent comments from Saudi Arabian Airlines about its own discounted fuel have prompted Emirates to start laying out evidence that it does not similarly benefit.
Emirates says it procures fuel at market rates from Dubai, where fuel is sourced from five suppliers: Shell, Chevron, BP, ENOC and Emarat. Outside of Dubai the airline also includes Exxon among its main suppliers.
United Arab Emirates-based ENOC and Emarat, it says, provide the carrier with a "minority" of its fuel requirement at Dubai - although they still sell fuel at commercial prices - while the majority of fuel is purchased from the global providers.
The airline states that it pays the Platts 'Arab Gulf' rate for fuel at Dubai, and that there is an additional local storage charge which is "higher at Dubai than at many other airports" - resulting in a higher price for fuel at Dubai than at some locations.
There is a "direct influence and close relationship", claims Emirates, between average jet fuel prices and its fuel expenditure per unit capacity.
Emirates adds that its fuel amounts to 35% of unit costs, a figure in line with the proportions of other international carriers such as British Airways, Lufthansa and Singapore Airlines.
Source: Air Transport Intelligence news
