Old Oct 18, 08, 5:35 am
  #7  
lhr baby
 
Join Date: Apr 2006
Location: UK
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Originally Posted by Tiger_lily View Post
This whole fuel surcharge saga will be much like the energy companies I suspect. Like greased lightning putting them up but very slow to bring them down if at all.
Whilst this may be off topic, I make no excuses for correcting a blatently incorrect statement. Energy companies are not like "grease lightening" putting prices up or necessarily that slow to bring them down. You clearly don't know how fuel price contracts work or how hedging is used to offset variations in prices and protect the customer against peaks. You have to make decisions from many months or even a year ahead to hedge against prices, or the costs would spike and tumble on a day to day basis and individual customers would face a price lottery. Once you've signed up to a hedging or contract deal its fixed, just like your fixed interest morgage is fixed, for the duration of the term. The price hikes only occur when the rolling average goes up or comes down. Sorry to be so blunt in my response but this is a common misunderstanding amongst the general public about how fuel is costed and charges passed on to customers. I'm not so knowledgeable about airlines but very knowledgeable about fuel prices and I have no doubt the airlines work in the same way as the energy companies.
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