Fuel Surcharges.... Any Reduction Soon?

[EWR]

I think SIA is just dragging it out as long as it can...

[9V-SIA]

I think SIA is just dragging it out as long as it can...

I would.

Peak traveling season.

Drop surcharge when the season is over...

[sqdazz]

http://www.nationmultimedia.com/2008...s_30091387.php

thai airways 40% reduction in fuel surcharge - FANTASTIC! Thai Airways now back on my list of airlines I will fly regularly

[kal]

fuel price is so low now. Perhaps we shld support those airlines that scraped off the fuel surcharges and boycott those airlines tat still act blurrrr and carry on wanna make extra $$$ from us !!

[flyguy]

exactly wit oil prices dipping to even below US$40 and averaging US$43, down fromt he dizzling heights of $145 a few months back, the prices of jet fuel have come down too in tandem with oil prices back to even early 2007 and even 2006 levels - and yet SQ have been only giving token min reduction in its fuel surcharges - when some other airlines have even do away with it. Whilst it is likely that SQ hedged quite a proportion of its fuel when prices were high - but these are risks that the airline have to take and hence when the overall oil price have dropped so much - its only fair to its customers that its surcharges should be reduced or at this time even dropped totally.
And even before the oil prices surged around mid-year - dontf orget that SQ have hedged its fuel from even 2007 when prices were still below US$90 and yet when oi prices went up, it introduces surcharges so quickly. Similiarly now that oil prices have fallen drastically, SQ surcharges must be scrapped altogether.

[Russ]

The reason many airlines are stuck with high fuel prices is that they bought a lot of future contracts to hedge against further increases in oil prices. These could be up to 2 years ahead and they are contractually bound to pay for these hedges (not just futures, thare are also swaps, collars and other instruments).

So when prices were 100 USD/Bbl, they might have hedged a lot at the prices, just in case it goes up to 150 or more. Of course, nobody expected prices to drop to below 40 dollars.

So, surcharges are coming off slowly as the big airlines are all stuck until these contracts gradually expire. So, sometimes, to prevent getting burnt going up, they end up getting burnt when it all comes down.

Airlines who hedged less can reduce surcharges more quickly. But again, why should we end up paying for the mistakes of the airline? In the end, competition will prevail and SQ will have to drop them.

[kras]

As wrong as I believe those surcharges are now, but...

No company will proactively undertake such actions that will possibly reduce their revenue, whatever the case may be.