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Fuel Increases?

C & L

By C & L,
in Royal Caribbean International

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copnlpn2

copnlpn2

Posted
Posted

I haven't seen anything yet to indicate we'l be having fuel surcharges passed on to us..yet.

 

I have to say hats off to RCCL for holding back on the fuel surcharges thus far...especially since the cost of a barrel of oil has gone through the ceiling. Thanks, RCCL!!!!!!!!!!!!!!

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CruisinManiac

CruisinManiac

Posted
Posted

With yesterday's news that the airlines adding them on, I think that the cruiselines will not be far behind. :( Refresh my memory. If you already have a cruise booked, can the fuel charges be added? I am sailing Celebrity, but thought they might have the same rules as RCCL.

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Shippy Great Review Rare

Shippy

Posted
Posted

Last week we booked a last minute, 5 day cruise on the Queen Victoria (Cunard) out of L.A. for February 13th. The prices are very good but they did add on $15 each for the fuel charge. I can hardly blame them with oil over $90. a barrel.

I think the fine print on most cruise contracts say that they have the right to impose a surcharge when the price tops $65. a barrel.

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Gonzo70

Gonzo70

Posted
Posted
If you are after final payment, you would not have to pay it

 

Not necessarily true; the current policy allows them to add a fuel surcharge to all reservations, irregardless if they are already deposited or fully paid. It doesn't mean they will definitely do it that way, but the current policy would allow them to.

 

As I have said on other threads, the rise in fuel has been much more slow and steady this time and that has allowed RCCL brands to build their rising fuel costs into pricing. Also, RCCL has been very profitable the past couple of quarters without a fuel surcharge; the last time they invoked a fuel surcharge was during a period they were doing quite poor financially and needed cash. If oil surpasses $100 per barrel (which it might due to the current unrest in Egypt) I could see them invoking a fuel surcharge, but so long as oil in under that level I would be surprised to see the fuel surcharge.

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Gonzo70

Gonzo70

Posted
Posted
With yesterday's news that the airlines adding them on, I think that the cruiselines will not be far behind. :( Refresh my memory. If you already have a cruise booked, can the fuel charges be added? I am sailing Celebrity, but thought they might have the same rules as RCCL.

 

RCCL is actually the parent corporation of a few cruise lines, but is not a cruise line itself. RCCL owns/operates Royal Caribbean International (RCI), Celebrity, Azamara, CDF and Pullmantur - they also have a 50% stake in TUI. Celebrity and RCI do share the same fuel surcharge policy. As I mentioned in my prior post, Celebrity can add the fuel surcharge to your sailing even if you have already paid a deposit, or even are fully paid, but there is a decent chance that they would grandfather people in so as to not create ill will. In 2007 RCCL had a policy that no additional charges would be added to a reservation once a deposit is made aside for government taxes/fees (which a fuel surcharge is not). In 2009 they changed the language of the cruise contract to indicate that fuel surcharges can be added at any time to reservations at any stage when the cost of a barrel of oil (WTI rate) exceeds $65.

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Gonzo70

Gonzo70

Posted
Posted
Won't be long now I figure. Probably all the lines are waiting for one of them to blink and then the rest will follow quickly.

 

About five lines have them now, some (i.e. Cunard) have had them for nearly a year.

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Bakincakes

Bakincakes

Posted
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I agree with Gonzo...if things get worse in Egypt and there is an interruption of the oil flow you may see prices skyrocket.

 

And it will also depend upon who takes charge in Egypt as well. If radicals take over we ain't seen nothing yet with skyrocketing oil prices.:eek:

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cruisinfanatic

cruisinfanatic

Posted
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Not necessarily true; the current policy allows them to add a fuel surcharge to all reservations, irregardless if they are already deposited or fully paid. It doesn't mean they will definitely do it that way, but the current policy would allow them to.

 

maybe they could but it is highly unlikely they are going to bother thousands of paid in full customers

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NordicPrince

NordicPrince

Posted
Posted

Why can't the cruise lines hedge their fuel costs ahead of time like

many companies in other fuel sensitive industries successfuly do?

 

Or is it easier just to look incompetent and annoy your customers?

 

What other fees is the traveling public expected to willingly swallow ?

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Paul65

Paul65

Posted
Posted
Don't count on it, they tacked the fee onto everyone paid or not last time....

 

No. Last time they exempted passengers who were already paid-in-full, and eventually reversed the fuel surcharges altogether, based on the uproar over it. Since then, they changed the wording on contracts and bookings to make sure it clearly states up-front that they reserve the right to add a fuel surcharge.

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Paul65

Paul65

Posted
Posted
Why can't the cruise lines hedge their fuel costs ahead of time like

many companies in other fuel sensitive industries successfuly do?

 

Or is it easier just to look incompetent and annoy your customers?

 

What other fees is the traveling public expected to willingly swallow ?

 

They all do a certain amount of hedging. But they can't lock in low prices forever. So, if prices remain high, those hedges at lower prices eventually run out. RCCL generally does a pretty good job of hedging fuel prices.

 

Just FYI - Here's an excerpt from their 2009 annual report:

We do not forecast fuel prices and our cost calculation for fuel is based on current “at-the-pump” prices net of any hedging

impacts. If fuel prices for the full year 2010 remain at the level of January 28, 2010, fuel expenses for the full year 2010 would be

approximately $687.0 million. For the full year 2010, our fuel expense is approximately 50% hedged and a 10% change in fuel prices

would result in a change in our fuel expenses of approximately $34.0 million for the full year 2010, after taking into account existing

hedges.

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negc

negc

Posted
Posted
Why can't the cruise lines hedge their fuel costs ahead of time like

many companies in other fuel sensitive industries successfuly do?

 

Or is it easier just to look incompetent and annoy your customers?

 

What other fees is the traveling public expected to willingly swallow ?

 

Royal Caribbean, more than several other mass market lines, has had a very good record of hedging their fuel costs. If you bothered to read their annual reports you would see that this is so. So I guess your comment applies to lines like Cunard which reintroduced a fuel surcharge several months ago. As yet none of the other mass market lines have chosen to follow suit, so perhaps we should be grateful instead of criticizing them for something they have yet to do.

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