Fuel Surcharges - rising, static or falling?

Hi

Does anyone keep a close track of what is happening with fuel surcharges in relation to crude oil?

Crude oil has fallen by around 30% yet airfares don't appear to be moving (I am aware that fuel is hedged and operating costs won't fluctate on an intraday basis like the oil markets). Whilst I am know the revenue/profitability pressures airlines are under, I was hoping either VS or BA would make the first move in more competitive pricing.

I believe the US Department of Trade issued a warning to airlines a few months ago that fuel surcharges had to accurately and fairly reflect the true running costs.

An example is an UC flight to JFK. The return mileage is 10,374 and fuel surcharge is £319.

Compare that to an UC flight to CUN. The return mileage is 14,830 and fuel surcharge is £319.

Unless the 744 to CUN is super efficient, surely that's proof that fuel surcharges have no reflection on true operating costs for VS?

The various iniquities of the YQ have oft been debated on this (and other) boards.

Main conclusion is that they bear no relation

to the actual price of oil

the fuel needed for a particular flight to a particular destination

and that airlines will charge what they think they can get away with

They could magically remove YQ tomorrow but all they would do is add the same amount to the base fares - whihc many of us belive it should be part of anyway.

This was the article I read a few months back - http://www.businesstravelnews.com/Business-Travel/DOT-Adds-Teeth-To-Fuel-Surcharge-Rules/

I'd be interested if there was some follow up to it.

If VS removed YQ and added that to the base fare, they would have to do something like increase the number of miles required for a redemption ticket.

It wouldn't surprise me if the fuel surcharge terminology is reworded in the not too distant future.

Airlines also hedge fuel so the price today may not bear relation to the price they have paid.