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Fuel surcharge - will it head down

Posted:
02 Sep 2008, 12:43
by McMaddog
Since oil proces have been falling for almost 2 months now (since July 11) what's the chances of fuel surcharges being lowered any time soon.
LinkNo sarcasm please! (Well, not too much)

Posted:
02 Sep 2008, 12:56
by Neil
It is a very valid point, but I wouldn't hold out much hope. They are very quick and vocal about putting it up but quite the opposite about it coming down.
We have however just negotiated out fuel surcharge with our haulage contractor down from 13.5% to 10.5% so prices are obviously coming cheaper. The problem is that the big companies buy in bulk well in advance and will often cite that as a 'reason' for not being able to lower the surcharge.
Neil

Posted:
02 Sep 2008, 13:03
by Darren Wheeler
Plus the pice of oil isn't lower than at the time the last surcharge was added.

Posted:
02 Sep 2008, 13:24
by RJD
Plus the GBP is at 2 year lows against the USD...

Posted:
02 Sep 2008, 13:31
by McMaddog
I found
this interesting article

Posted:
02 Sep 2008, 14:01
by capetownflyer
I believe there is a BA/VS conference call later today to dicuss what they are doing re fuel surchares.....

Posted:
02 Sep 2008, 14:26
by miopyk
Originally posted by capetownflyer
I believe there is a BA/VS conference call later today to dicuss what they are doing re fuel surchares.....
Ah good, more refunds[}:)]
Miopyk[8D]

Posted:
02 Sep 2008, 15:13
by pjh
I hope I'm proved wrong but I can't see this fall being anything other than a short term blip (or whatever the inverse of 'blip' is). Nights are a drawing in and Russia would only need to get huffy in public again for prices to resume an upward trend.
Paul

Posted:
02 Sep 2008, 18:14
by VAFFPAX
Unfortunately fuel surcharges are likely to be based on their fuel hedges, which stretch far into the future. Unless the oil prices drop by 2010 or whenever the fuel hedges end, the surcharges are not going to drop.
S.

Posted:
02 Sep 2008, 20:15
by RichardMannion
Given that thefuel surcharges only cover a small proportion of the actual delta, I'd doubt it.

Posted:
16 Sep 2008, 10:44
by McMaddog
Just an update - when I posted this oil was at USD110, it has just hit USD90. I'm guessing that airlines renewing hedges now will be sitting pretty.

Posted:
16 Sep 2008, 15:17
by Bill S

Posted:
16 Sep 2008, 15:49
by Stevieboy
Originally posted by McMaddog
Just an update - when I posted this oil was at USD110, it has just hit USD90. I'm guessing that airlines renewing hedges now will be sitting pretty.
Slightly off topic, but why with the price of oil still falling have quite alot of petrol stations in London increased their prices by a penny this week. Petrol is still only 7p less than it's peak price when oil was $145.[V]
-Steve

Posted:
16 Sep 2008, 16:05
by Bill S
Oil down to the low $90s and
SRB predicts falls to $56.VS is among the higher fuel surcharge airlines.
Could be that we will get a drop to counter other increases in fares...

Posted:
16 Sep 2008, 16:52
by David
Originally posted by Stevieboy
Originally posted by McMaddog
Just an update - when I posted this oil was at USD110, it has just hit USD90. I'm guessing that airlines renewing hedges now will be sitting pretty.
Slightly off topic, but why with the price of oil still falling have quite alot of petrol stations in London increased their prices by a penny this week. Petrol is still only 7p less than it's peak price when oil was $145.[V]
-Steve
The official line is that the drop in the barrel of oil has been offset against the pound losing nearly 15% of it's value against the dollar £1 = $2 in may £1 = $1.70 today .
However I would expect the price at the pumps to slowly start to drop in the next few days / weeks
Cost price of UNL has risen by over 2ppl in the past week
David

Posted:
16 Sep 2008, 23:49
by Sealink
In Australia they have slashed the fuel surcharge on flights to London, not sure if this works both ways though.
Virgin Atlantic reduces fuel charges to London by up to AUD$310

Posted:
17 Sep 2008, 01:05
by honey lamb
Originally posted by Sealink
In Australia they have slashed the fuel surcharge on flights to London, not sure if this works both ways though.
Virgin Atlantic reduces fuel charges to London by up to AUD$310
Erm, Sealink. Bill S posted that information 4 posts above yours [:w]

Posted:
17 Sep 2008, 18:03
by Alex V
Is it likely that if VS reduce their surcharge shortly anyone travelling after this date will get a refund of the difference on booked flights[}:)]
Oh and by the way Sealink 'wake up'[|)][|)]

Posted:
19 Sep 2008, 08:49
by Scrooge
AC and WS have dropped their fuel surcharges now, but no I don't think in the near term we will see VS (or BA) dropping theirs.

Posted:
19 Sep 2008, 10:49
by Alex V
Originally posted by Scrooge
AC and WS have dropped their fuel surcharges now, but no I don't think in the near term we will see VS (or BA) dropping theirs.
So its not likely that if announcements are made of surcharge drops that it would make pre booked flights after that date any cheaper. That would seem a little unfair[:?]
cheers
alex

Posted:
19 Sep 2008, 10:58
by McMaddog
Originally posted by av_norw792
Originally posted by Scrooge
AC and WS have dropped their fuel surcharges now, but no I don't think in the near term we will see VS (or BA) dropping theirs.
So its not likely that if announcements are made of surcharge drops that it would make pre booked flights after that date any cheaper. That would seem a little unfair[:?]
cheers
alex
Taking that the other way, would it be fair if you'd booked tickets and then a surcharge increase was applied that you were charged an excess when checking in?
Of course the judgement of fairness really depends on whether the fuel surcharge represents true costs or is profiteering to some extent.

Posted:
19 Sep 2008, 11:38
by Alex V
So its not likely that if announcements are made of surcharge drops that it would make pre booked flights after that date any cheaper. That would seem a little unfair[:?]
cheers
alex
[/quote]
Taking that the other way, would it be fair if you'd booked tickets and then a surcharge increase was applied that you were charged an excess when checking in?
Of course the judgement of fairness really depends on whether the fuel surcharge represents true costs or is profiteering to some extent.
[/quote]
Thats not really what i was asking because your point is fairly rhetorical that ofcourse it wouldnt be fair to pay extra at checkin[:D].
However knowing that such a high levy on fuel was now not applicable to your flight although having paid it, i would feel that perhaps a decent explanation would need to be recieved from VS as to why they are keeping my surcharge so high without 'part refund' or a gesture of good will.[:?][:?][V]

Posted:
19 Sep 2008, 15:20
by musicmanbrain
.....if they just included the fuel surcharge in the actual advertised cost of the flight (after all, its not like there is any option to pay the charge, so how can it possibly be termed an extra), then this entire discussion would be irrelevant. Come on VS, get it together (and guess what - they could increase the fuel surcharge a bit and NOBODY WOULD NOTICE!)

Posted:
19 Sep 2008, 16:34
by Alex V
Originally posted by musicmanbrain
.....if they just included the fuel surcharge in the actual advertised cost of the flight (after all, its not like there is any option to pay the charge, so how can it possibly be termed an extra), then this entire discussion would be irrelevant. Come on VS, get it together (and guess what - they could increase the fuel surcharge a bit and NOBODY WOULD NOTICE!)
Not sure if i like that idea only because if it becomes part of the overall advertised cost you may never really know, like you say how much you are paying, atleast by keeping it a an 'extra' you can kinda see what that extra cost is.
If you have to pay for the fuel thats one thing, but if you dont use all that fuel up although having paid up front, i think most people would want the cost of that fuel back(refund)
does that sound logical?[:D]

Posted:
19 Sep 2008, 16:37
by McMaddog
Certainly one benefit of keeping it seperate is that if you need to cancel a non-refundable ticket you can at least get all the tax and fuel surcharge back. Seeing how some N tickets are only a few pounds more than the surcharge they basically become fully refundable. This assumes there isn't some funny in the Ts and Cs.