Tag-Archive for » Fuel surcharge «

The Impact Of The Cost Of Fuel…?

The price of oil fell to $36.51 on Friday, far from when analysts were speculating it might go as high as $200. The national average for gasoline in the U.S. is now below $2 per gallon for the first time since the horse and buggy, it seems.

Cruise experts like our pal Phil Reimer say cruise prices are on the rise. Cruise lines are reporting enormous profits in their financials…how enormous is Carnival’s $2.1 billion net profit for 2015?

Are we missing something here?

A major cost for cruise lines is going down and the cost of cruising is going up?

Some airlines still include fuel surcharges in the price of tickets. While none we know of have that audacity, some cruise lines still have the option of doing the same thing. Some government postal services still add it to the price of shipping.

When will it end?

Probably when the people speak with actions…by not using the services of companies that adopt such ridiculous policies — or at least by using them less.

In the news…

• Carnival’s fees for room service to go fleet-wide after three-ship test

Today at portsandbows.comThe Harmony-ous fall from 10 stories


Ruby Princess
7 nights
June 19, 2016
Seattle (return): Ketchikan, Tracy Arm, Juneau, Skagway, Victoria
Inside: $899
Cost per day: $128
www.princess.com

The Impact Of Oil On Cruising

 

If there’s a more confusing three-letter word than “oil” we don’t know what it is.

Oil production goes up, the barrel price goes down. The barrel price goes down, unemployment goes up. At the same time, the price at the pumps goes down. All this instability sends investors scurrying, so the stock market goes down.

What happens to cruise prices?

Probably nothing. Cruise lines make more money because the cost of powering their ships drops. Royal Caribbean and Norwegian both hit year highs on the stock market this week. Should such gains be passed on to the cruise customer? 

Let’s put it this way: In the volatile world of oil prices, cruise lines inserted a line in the contracts with passengers that they could add a surcharge to cover oil.

How many did?

In the past five years, not once did we get hit with an oil surcharge. At least, not on cruises. Getting to them is another story, because airlines — at least some — didn’t just put the surcharge option on the table. They charged it, and when the price of oil dropped, the surcharges didn’t disappear. What they did do was bury it the cost of flying, saying it includes “surcharges” that were “to partially offset certain volatile…operating costs.”

Fuel.

While most of us are incapable of making sense of oil prices, it seems the cruise industry is prepared to roll with the punches. At the same time, the fuel surcharge rider is there…in case fuel costs become ridiculous, as they did in June 2008, peaking at $134 a barrel (yesterday it was $55). In other words, the surcharge possibility gives cruise lines an out, one they appear determined not to use.

Today at portsandbows.com: Getting the jump on Wave Season

Holland America Westerdam
7 nights
January 17, 2015
Fort Lauderdale (return): Grand TurkSan JuanSt. MaartenHalf Moon Cay
Inside: $499
Cost per day: $71
www.hollandamerica.com

The Skinny On Cruise Fuel Surcharges

Travelers who subscribe to Travel Weekly — billed as “The Travel Industry’s Trusted Voice” — may have noticed that cruise lines are experiencing an unexpected drop in fuel prices despite that turmoil in many oil-producing countries. As a result, cruise lines are enjoying better bottom lines.

For example, Norwegian is paying less for fuel this year than last even though it has added the Getaway to its fleet. Carnival’s comparative fuel expense is down $28 million from last year. Royal Caribbean has experienced a more modest saving, according to Travel Weekly.

So…

The tendency is to think that cruise lines should drop the price of cruising that reflects the drop in cost of fuel, because when the price of oil rises sharply they implement a surcharge.

Not true.

Cruise lines have a fuel surcharge that they can add to the cost of your cruise ticket. That doesn’t mean it’s a given that it will happen.

We’ve been cruising regularly for the last five years. During that time, here is what the per-gallon cost cruise lines pay has done:

May 2010 — $1.67
May 2011 — $2.39
May 2012 — $2.52
May 2013 — $2.24
May 2014 — $2.26

In other words, with the exception of 2013, it has gone up every year. Not once during that time have we experienced the dreaded “fuel surcharge.”

Today at portsandbows.com: Internet deals from Oceania

Royal Caribbean Splendour of the Seas
7 nights
November 8, 2014
Venice (return): Dubrovnik, Ephesus, Santorini, Olympia
Inside: $628
Cost per day: $89
www.royalcaribbean.com

Cruise Fuel Supplement Old News

As you know, it's always important to read the fine print in your cruise contract. There's a line that has been running in most cruise contracts for many months now, one that nobody seems to pay any attention to…including the cruise lines.

It's the fuel supplement.

The line goes something like this: "…[cruise line] reserves the right to impose a fuel supplement of up to $10 per guest per day if the price of fuel exceeds $65 per barrel."

The last time oil prices were that low was mid-2009. Since then, we've been on 11 cruise ships and not once has the fuel supplement been mentioned, never mind activated.

It's been more than two years since crude prices were below $80 a barrel, and this week's price has been between $90 and $100 a barrel. So what's the point of the fine print? Is it an idle "threat" or a financial safety net for cruise lines?

At the very least, shouldn't it be updated?


Windstar Wind Spirit
7 nights
May 4, 2013
Athens, Mykonos, Santorini, Rhodes, Bodrum, Ephesus, Istanbul
Oceanview: $3,199
Cost per day: $457
www.windstarcruises.com

Prices on the Rise for Norwegian

The way we see it, which is not always through rose-colored glasses but is always through either bifocals or progressives, Norwegian is increasing fares by 10 per cent on the first of April for one of four reasons:

1. In this era of rocketing oil prices, it’s a way of covering NCL’s inevitable increased expenses without invoking the most despised and suspicious words in cruise-ship pricing — “fuel surcharge.”

2. The Wave Season promotion, which gives NCL customers up to four-category upgrades, is selling so well that Norwegian sees this as the perfect time to increase fares, since there is no perfect time.

3. The deadline creates an urgency to buy before the price goes up.

4. Well, it is April 1.

What do you think?

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