SEOUL, S KOREA - South Korea may raise fuel surcharges for international flights following requests by airlines to reflect soaring oil prices, a transportation ministry official said yesterday, lifting shares of Korean Air and Asiana.

'We are considering the request and the decision is likely to be announced by mid-June as a part of overall counter-measures against rising energy prices,' an official at the ministry told Reuters.

The official said that Korean Air and Asiana had requested earlier this month that the government raise the maximum fuel surcharge they can impose on long-distance flights as oil prices continue their rush to fresh record highs.

Oil prices, which have quadrupled in the past five years and hit a record of just over US$135 last week, were trading at around US$128 yesterday.

They have been rising inversely to the dollar amid a fever of speculative trading as China and India race for economic growth.

Currently, Korean airlines charge US$140 in fuel surcharges for one-way long-distance international flights, up from US$52 late last year.

Korea, which depends heavily on energy imports to power Asia's fourth-largest economy, is also considering raising electricity costs in the second half of 2008.

If it does, that would mark the first increase since it raised prices by 2.1 per cent in January 2007, and will follow hikes by a series of Asian nations to fuel and power prices as they can no longer afford to shield consumers from soaring world oil prices.

So far, Korea's efforts have been centred on softening the blow of oil prices for consumers to ease inflationary pressure in the face of soaring food and energy prices.

Korea slashed import tariffs on oil products such as petrol and fuel oil to one per cent from 3 per cent last month but kept tariffs on crude oil and liquefied natural gas at one per cent, turning away from its initial pledge to cut the duties, because of concerns over tax revenue losses. - Reuters