If you are planning a trip abroad, and you haven’t bought your tickets, there’s a good chance you will be paying more for fares.
The price of oil has gone up and the fuel surcharges to many international destinations have gone sky high. A couple of years ago, we saw roundtrip sale fares from Los Angeles to Sydney, Australia for $679, including all taxes and fees. Today the fuel surcharge alone is $680.
Back in 2007, when the price of oil hit over $80 per barrel, the airlines first started charging a fuel surcharge, and the fees were $130 to London and $150 to most of the rest of Europe. Those surcharges seemed reasonable to cover the increased cost of fuel and even today we see shipping companies like DHL, FedEx and UPS charge approximately a 14 percent surcharge because of higher fuel costs.
Airline fuel surcharges have gone ballistic and the fuel surcharges to European cities have more than tripled since 2007, yet today oil costs approximately $95 a barrel, which is only 20 percent more than what it cost when the airlines first started charging fuel surcharges.
When fuel costs were at their peak four years ago, a barrel of oil cost $146 a barrel, which is about $50 more than today’s prices, yet the fuel surcharge to most of Europe at that time was $320 and today it’s a whopping $516. England and Ireland have typically had lower fuel surcharges and the fees at press time were $428 to Ireland and $458 to England.
The price of oil is not the only reason that fares to Europe are going up, supply and demand are also at work. Due to the recession, the airlines reduced the number of seats available to Europe due to fewer people traveling. Recent reports show that business and leisure travel is almost back up to pre-recession numbers, but the airlines have not increased the number of seats to those pre-recession levels, so the airlines can charge more for their seats.
What’s even worse about these fees is that the major U.S. and international airlines must think that Americans are the sugar daddies of the world by charging U.S. travelers so much more in fuel surcharges to fly to Europe than the Europeans pay to come to the U.S. The Europeans are paying about $180 less in fuel surcharges to come to the U.S. than we pay on flights originating from the U.S. to Europe. The difference originating in England is less, but we still pay $82 more.
The real question should be, why do USA travelers need to subside the European airfares and fuel surcharges? It could also be that Americans are getting used to paying more. We have been bombarded since February 2008 with an unbelievable amount of new fees including: check bag fees, change fees, internet fees, seat assignment fees, pillow fees, etc. etc. etc.
Americans should be outraged and screaming foul, that we are paying more for the same flights, same travel period, and especially over the $180 fuel surcharge difference. The only other two words that come to mind are "Skyway Robbery".
We looked at a 6-night stay originating in Dallas to Paris departing on September 18 and it cost $1,080 roundtrip, but the price originating in Paris to Dallas for flights on the same dates and same airline cost $857 roundtrip. That’s a difference of $203, which includes the $180 difference in fuel surcharges and the difference in the value of the Euro compared to the dollar, making the fare itself slightly lower. When we look at other destinations, like Sydney, Hong Kong and Shanghai, passengers are charged the same amount for fuel surcharges, no matter where the flight originates from, so if you’re a U.S. citizen flying to Europe you will be subject to skyway robbery.
Check out these other destinations and in each case Americans pay more.
|Cheapest Base Airfare, Including Taxes From Europe to the USA||Fuel Surcharge||$336Total Price From Europe to the USA||Cheapest Base Airfare, Including Taxes From the USA to Europe||Fuel Surcharge||Total Price From the USA to Europe||Europeans Pay This Much Less|
|Los Angeles to Milan||$528||$336||$864||$517||$516||$1,033||$169|
|Chicago and Frankfurt||$428||$336||$764||$540||$516||$1,056||$292|
|Dallas and Rome||$543||$336||$879||$510||$516||$1,026||$147|
In some countries, like many in Asia and South America, the airlines are required to file for price increases, including raising fuel surcharges, and these increases must be government approved. We notice that fuel surcharges are lower to some of these destinations than to Europe, where the rules are more liberal.
Hong Kong has one of the cheapest fuel surcharges, at $249 and from New York City the flight is about 14,000 air miles roundtrip. New York City to Paris is about 7,000 air miles roundtrip, yet the fuel surcharge to fly half the distance is almost twice the price at $516.
These fees might make more sense if they were truly a fuel surcharge, but the airlines are not only recouping 100 percent of their fuel costs, but they are also making a handsome profit on the fuel surcharges. The Department of Transportation has said they would look into fuel surcharges, but so far, they have taken no action to curb these price fixing fees. There are some bright spots in international travel when it comes to fuel surcharges. We’ve recently seen the fuel surcharges removed from destinations in Central America and South America, bringing prices down to those places.
The fuel surcharge to Argentina and Chile had been as high as $600, so it is very nice to see these fees eliminated! Also Costa Rica, which recently had its fuel surcharge eliminated, has some of the best fares we’ve seen in years and are up to $200 cheaper than before the fuel surcharges were removed.
Today not only can we sell you an airfare, but we can also include a four-night stay at a four-star hotel for cheaper than what they were charging for airfare alone! Any time we have a fuel surcharge it’s a form of price fixing and a floating, fluctuating airfare will keep airfares competitive, and in most cases lower, and should be mandated.
When it comes to redeeming miles, one thing you’ll need to watch out for is that a number of foreign airlines are charging a fuel surcharge for award tickets on international flights. For example, if you want to cash in miles on British Airways from the U.S. to Europe, you’ll be redeeming 50,000 miles, plus paying the fuel surcharge and other taxes and fees.
So far, we haven’t seen U.S. based carriers charge a fuel surcharge on award tickets, but you do have to pay international taxes, such as entry and exit fees. You are better off redeeming those BA miles on a flight within North America on their codeshare partner American Airlines, since fuel surcharges will not apply. We think Canada, Mexico and the Caribbean are great options for cashing in BA miles on American Airlines and avoiding fuel surcharges.
You’ll also want to pack light when traveling to Europe because baggage fees for the second bag can cost as much as $100 each way. While your first checked bag is free to most international destinations, the fees for a second checked bag to Europe have gone up to $100 on United, US Airways and Delta to many international destinations including those in Europe. On Delta you can save some money and pay $80 if you pay ahead online, or $100 if you pay at the airport for second checked bags to Europe. At press time, American was charging $60 for a second checked bag to Europe, which seems like a bargain in comparison.
Check out these fuel surcharges from the USA to around the world:
|Destination||Roundtrip Fuel Surcharge|
|Paris and to over 90% of European Destinations||$516|
|Istanbul||$326 for most airlines, $254 on AA and $516 for British Airways|
|Singapore||$363, only United $305|
|Tel Aviv||$422 United, $516 BA, $610 Delta, $534 AA|
|South Pacific / Australia||$680|
If all this doesn't make you red in the face, then this next story should. Did you know that the airlines are making a $66,500 profit per trans-Atlantic flight on the fuel surcharges they are adding into the price of your airline ticket.? Read more about it here.
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