Fuel Surcharges v dropping price of oil

[Gawd Elpus 798]

With oil dropping from 150 USD per barrel now down to 40 USD per barrel, why are we not seeing this reflected in the price airline of flights.? The motorist has seen drops in fuel prices at the pumps.. Virgin say, that often, jet fuel is bought months, sometimes years in advance. So is it just a matter of waiting then ? I don't think so, and I don't think that any of the major airlines will pass on the lower running costs to the customer, any time soon, and perhaps anticipate oil prices rising again .

[Grandpollo 366]

The fuel surcharge is not a fuel surcharge which is why the amount of it has not varied with the fuel price. Especially in countries where the all in price doesn't have to be advertised.

 

Also other for than a week or so 8 years ago the price has never been US$150/bbl.

 

 

 

 

 

[jacko 8,822]

With oil dropping from 150 USD per barrel now down to 40 USD per barrel, why are we not seeing this reflected in the price airline of flights.? The motorist has seen drops in fuel prices at the pumps.. Virgin say, that often, jet fuel is bought months, sometimes years in advance. So is it just a matter of waiting then ? I don't think so, and I don't think that any of the major airlines will pass on the lower running costs to the customer, any time soon, and perhaps anticipate oil prices rising again .

The price of something has little to do with the sum total costs of its components other than setting a minimum line, more to do with being the maximum the market will bear.

Those that still use fuel surcharges are likely getting embarrassed by them, they were an excuse to hide real prices in the past while oil was rising.

 

I am currently searching for a ticket to UK this spring and struggling to find any bargains, may be changing carriers and flying via Helsinki or Istanbul!

Oh well, fuel for the truck and bike is somewhat cheaper now here.

[Fatboyfat 361]

Not much for me to go on this year, but I do have a similar Glasgow - Bangkok (1st) return coming up which is about 12.5% less than last year. However, the booking had to be made through an agent this time (Flight Centre) as Emirates were/are not offering any of their normal seasonal reductionson their website. Some of the reasons for no reductions in Economy or even Biz are probably down to the claim that the airllines subsidise the economy fares anyway, and cheaper fuel would allow that subsidy to be reduced. Another problem is the relentless rises in "airport tax" applied by government of late, raising the fare and negating fuel savings. The "simplified" breakdown of costs on your flight ticket, do not really accurately reflect what is going on.

[TheFiend 1,181]

Not much for me to go on this year, but I do have a similar Glasgow - Bangkok (1st) return coming up which is about 12.5% less than last year. However, the booking had to be made through an agent this time (Flight Centre) as Emirates were/are not offering any of their normal seasonal reductionson their website. Some of the reasons for no reductions in Economy or even Biz are probably down to the claim that the airllines subsidise the economy fares anyway, and cheaper fuel would allow that subsidy to be reduced. Another problem is the relentless rises in "airport tax" applied by government of late, raising the fare and negating fuel savings. The "simplified" breakdown of costs on your flight ticket, do not really accurately reflect what is going on.

 

Last flew on Emirates in Nov 14 and my April trip with Emirates is 15% cheaper - and that was booked when a "Black Friday" email offer popped up in my inbox.

 

In the 10 years since I started visiting Thailand last 3 trips to Thailand have all been cheaper than my first trip 10 years ago.

Edited January 6, 2016 by TheFiend

[Bob Belzy 150]

Qantas is miraculously a profitable airline again, mostly due to reduced fuel prices.

[Fatboyfat 361]

Qantas is miraculously a profitable airline again, mostly due to reduced fuel prices.

They have also stopped offering "good deals" inthe premium classes, which is where the profits are. My particular type of ticket with them would now be 2.5 times as much, compared to when they were trying to compete with Emirates, a couple of years back.

[jacko 8,822]

They have also stopped offering "good deals" inthe premium classes, which is where the profits are. My particular type of ticket with them would now be 2.5 times as much, compared to when they were trying to compete with Emirates, a couple of years back.

It is annoying isn't it..... !

I detest Economy long haul, but the prices I am seeing there are just so cheap I struggle with the alternative of 100,000 baht!

There was a time when I paid 2x Economy and that didn't bother me, but now I am looking at 4x. That said I also recall BA would be £3000+ when I was travelling a lot for work in the 90s....., I still would not pay that much!

Edited January 19, 2016 by jacko

[Gus 97]

I agree with you Jacko, fortunately I am now retired and can travel when I want, so I usually fly Mon-Wed.

For next weeks flight with Thai I have been checking what empty seats are showing on their web site, about 100 outbound so I should be OK to spread out. The reason i do not fly Eva so much is, A, because they bumped the premium Economy price up so much and B, Economy is normally full and you're unable to spread out.

[Gary 4,119]

I was recently reading an article about the jet fuel costs. Most airlines have hedged the cost of their fuel, some several years forward. American airlines was the only one who bought at spot prices. I'd imagine that right now they are making a huge profit.

[Saddic 31]

http://petergreenberg.com/2016/01/08/travel-tip-cheaper-jet-fuel-doesnt-mean-cheaper-airfare/

bottomline: only the airlines could manage to obtain such a MASSIVE loss from such a steep decline in oil prices...

hedging is not your friend in a falling environment...

 

 

Heard this morning... Oil price war has started... Iran vs Saudi's.... Good times...