Old Oct 18, 08, 2:52 pm
  #11  
Tiger_lily
 
Join Date: May 2006
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Originally Posted by lhr baby View Post
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.
Thanks for the flaming - I really appreciate it.

It doesn't matter if I know how these types of deals work or not. It's public perception, actually, that this is happening.

And more to the point why are BA and Virgin reducing them only in Economy? There's no justification for wringing the last penny out of J pax IMO
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