Beijing has cut the domestic jet fuel price by 6.9 per cent in a move to ease pressure on struggling airlines amid softening crude prices. Jet fuel, which accounts for up to 60 per cent of mainland airlines' operating costs in the first half, was cut by 570 yuan (HK$646) to 7,750 yuan per tonne from yesterday because international crude prices had dropped to below US$100 per barrel, Xinhua reported. The move had been widely anticipated as international jet fuel prices had fallen 39 per cent from the peak in June. However, the relief would be limited as the mainland's regulated jet fuel price has risen by 2,200 yuan a tonne since June. The National Development and Reform Commission, which sets the country's jet fuel prices, makes adjustments based on a formula that tracks a basket of international prices. Global oil prices have been falling amid concerns about shrinking demand for industrialised goods as a result of the global financial turmoil. Crude futures are trading at 30 per cent below the record US$147.27 a barrel reached on July 11. Jet kerosene price has fallen 39 per cent since hitting a record US$181.85 a barrel on June 3. It traded at US$110.75 yesterday in Singapore. The 570-yuan reduction was slightly larger than China Eastern Airlines' expectation, its investor relations manager Sunny Chou said. However, it would be difficult to estimate how much the airline can save in fuel costs as the company is cutting down capacity. The airline has eliminated some of its services because of falling demand. Analysts said the reduction was positive to the mainland's carriers, especially China Southern Airlines, which operates more domestic routes than Air China and China Eastern. Softening demand had become a bigger problem for airlines than oil prices, said an industry veteran. Carriers in the Asia-Pacific reported a 3.1 per cent decline in passenger volume in August after a 0.5 per cent fall in July. The impact of the Olympic Games and a weakening economy in Japan also contributed to the decline, said the International Air Traffic Association. Separately, Taiwan's China Airlines and EVA Airways will cut fuel surcharges by as much as 17 per cent from October 10.