International Airlines Group (IAG) formed out of the merger of British Airways and Spain's Iberia is appraising its fuel surcharges at a time when the oil price increase happened due to the unrest in the Middle East.

The chief executive of the company, Willie Walsh, stated yesterday that mounting fuel costs pose a challenge for airlines as the company came out with its first quarterly results, showing profits six million euros or five million pounds in comparison of a loss of one hundred and fourteen million euros seen in the last year.

IAG's short-term fuel requirements are largely prevaricated against sudden oil price variations but persisting high prices will feed through, and the surcharges are under evaluation, Mr. Walsh added. The oil price is a problem for the industry as a whole, he stated. Everybody has to be aware that high input prices will ultimately affect customers not just from airlines but from all businesses to be precise.

Mr. Walsh's comments came as the oil price, worldwide dipped slightly around one hundred and eleven dollars per barrel, having reached to a two-and-a-half year high of one hundred and twenty dollars on Thursday over worries about the restriction of supply from Libya and the potential for turmoil to spread to other big oil producers in the region.

The dipping price came as Saudi Arabia, the largest oil supplier of the world, indicated it could step up its production to compensate for any shortfall from Libya, if required. There is enough extra capacity present in the Saudi system to meet more than two times of Libya's commitments.

The recent revolt all over the Arab world is not the only feature that affected oil prices. The benchmark price was already going up strongly at the start of the year, pushed by the world economic recovery.