Is there any relationship betwen fuel surcharges and Jet Fuel prices?
Oct 14, 2014, 2:50 pm
#1
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Is there any relationship betwen fuel surcharges and Jet Fuel prices?
Jet fuel is no trading for $2.41 per gallon, down from an average of $2.95 over the last three years (all prices USD). This reduction is almost all in the last six weeks. Should we be expecting fuel surcharges to decrease?
Oct 14, 2014, 2:57 pm
#3
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(Bwahahaha)
Oct 14, 2014, 2:57 pm
#4
Join Date: Oct 2004
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Who knows - but I suspect not 
...
Here every week on Thursdays in NB the government sets the maximum price of gasoline and diesel for the next week based on the current price of oil amongst other things. Dealers may sell for less and usually do.
Have heard no complaints from consumers!
...Here every week on Thursdays in NB the government sets the maximum price of gasoline and diesel for the next week based on the current price of oil amongst other things. Dealers may sell for less and usually do.
Have heard no complaints from consumers!
Oct 14, 2014, 3:12 pm
#5
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Wirelessly posted (Mozilla/5.0 (BlackBerry; U; BlackBerry 9780; en-US) AppleWebKit/534.8+ (KHTML, like Gecko) Version/6.0.0.666 Mobile Safari/534.8+)
Yes.
However, to cover the shortfall caused by the rollback in fuel surcharge revenues, Air Canada will be implementing a fuel surcharge surcharge.
Originally Posted by wayner92
Jet fuel is no trading for $2.41 per gallon, down from an average of $2.95 over the last three years (all prices USD). This reduction is almost all in the last six weeks. Should we be expecting fuel surcharges to decrease?
However, to cover the shortfall caused by the rollback in fuel surcharge revenues, Air Canada will be implementing a fuel surcharge surcharge.
Oct 14, 2014, 4:15 pm
#7
Join Date: Sep 2014
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Out of curiosity, do you guys think that the "fuel surcharge model" is just to keep base fare cost/revenue stable, or do you really think it is a scam charge?
It seems to me that a cost is a cost, and that there would be no real long term difference between this model, and one where we put all the charges in one price called "ticket price".
Just curious on how it is perceived, and how it is used by AC vs other airlines.
It's like when a retailer tells someone "all prices are tax-in", and they think they got a deal. All that really happens is the owner just included the taxes in the ticket price.
It seems to me that a cost is a cost, and that there would be no real long term difference between this model, and one where we put all the charges in one price called "ticket price".
Just curious on how it is perceived, and how it is used by AC vs other airlines.
It's like when a retailer tells someone "all prices are tax-in", and they think they got a deal. All that really happens is the owner just included the taxes in the ticket price.
Oct 14, 2014, 4:55 pm
#9
Join Date: Dec 2007
Location: YUL
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Probably not since, while they may benefit from falling jet fuel prices, they are probably losing from their hedges.
According to their August 2014 MD&A, as of June 30th, 2014 they had hedged approx 40% of their exposure via WTI at avg 106 USD / barrel. Depends on how they roll them over and specific factors as to how falling oil prices impact their total overall costs.
I'm not going to say they should or shouldn't hedge, or comment on their particular strategy as I don't know much beyond what is in the MD&A and Annual Report about what they are doing, but this is the point of hedging: to smooth out the variable costs. You miss out on (some of) the benefits when prices move in your favour but don't lose (as much) if they move against you.
You could argue that this is all the more reason why they should build them into fares (but maybe then they couldn't scam-charge AP redemptions).
According to their August 2014 MD&A, as of June 30th, 2014 they had hedged approx 40% of their exposure via WTI at avg 106 USD / barrel. Depends on how they roll them over and specific factors as to how falling oil prices impact their total overall costs.
I'm not going to say they should or shouldn't hedge, or comment on their particular strategy as I don't know much beyond what is in the MD&A and Annual Report about what they are doing, but this is the point of hedging: to smooth out the variable costs. You miss out on (some of) the benefits when prices move in your favour but don't lose (as much) if they move against you.
You could argue that this is all the more reason why they should build them into fares (but maybe then they couldn't scam-charge AP redemptions).
Oct 14, 2014, 5:03 pm
#10
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(Any other incredulity or irony is simply redundant. AE and AC will reduce this on the 5th of Never. And every other 5th of Never from then on.)
Oct 14, 2014, 5:34 pm
#11
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Fuel is like coffee at Star Bucks or gas for our cars. Cost price goes up, our cost goes up. Cost price goes down, their is alway some BS reason why our price can't go down. There should be no fuel surcharge and gas at the pumps should be 80 cents.
Oct 14, 2014, 5:42 pm
#12
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We should stop acting like friendly Canadians and make a stink about this with our politicians. It's absurd that AC can get away with their misleading pricing.
Oct 14, 2014, 5:58 pm
#13
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Out of curiosity, do you guys think that the "fuel surcharge model" is just to keep base fare cost/revenue stable, or do you really think it is a scam charge?
Its ridiculous they charge this scamcharge on awards; they keep them in part because for int'l fares that are still commissionable, the YQ is not 'fare' and not commissionable. Of course, there are always great opportunities for mistakes when they file fares without them, or with vastly lowered ones.
Oct 14, 2014, 6:01 pm
#14
Join Date: Jun 2009
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A Fuel Surcharge is bull---- . What are they going to do if the pilots ask for more money, or the FA's or they pay to overhaul their IT, or new 787s? Add an extra little fee for all that stuff?
Its ridiculous they charge this scamcharge on awards; they keep them in part because for int'l fares that are still commissionable, the YQ is not 'fare' and not commissionable. Of course, there are always great opportunities for mistakes when they file fares without them, or with vastly lowered ones.
Its ridiculous they charge this scamcharge on awards; they keep them in part because for int'l fares that are still commissionable, the YQ is not 'fare' and not commissionable. Of course, there are always great opportunities for mistakes when they file fares without them, or with vastly lowered ones.
Oct 14, 2014, 6:10 pm
#15
Join Date: Oct 2007
Location: Calgary, Alberta, Canada
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A Fuel Surcharge is bull---- . What are they going to do if the pilots ask for more money, or the FA's or they pay to overhaul their IT, or new 787s? Add an extra little fee for all that stuff?
Its ridiculous they charge this scamcharge on awards; they keep them in part because for int'l fares that are still commissionable, the YQ is not 'fare' and not commissionable. Of course, there are always great opportunities for mistakes when they file fares without them, or with vastly lowered ones.
Its ridiculous they charge this scamcharge on awards; they keep them in part because for int'l fares that are still commissionable, the YQ is not 'fare' and not commissionable. Of course, there are always great opportunities for mistakes when they file fares without them, or with vastly lowered ones.
Also, the “elimination” of fuel surcharges in North America a few years ago, that still get charged on Aeroplan tickets really ticks me off.