US: Airlines reap benefits from cheaper fuel, consumers not so much
Consumers have benefited somewhat from the lowest jet-fuel costs in more than 12 years, but not nearly as much as the companies. While travellers are paying less on average for trips, base fares have remained essentially unchanged since 2014, according to CE Rick Seaney of FareCompare.com. Meanwhile, spot jet-fuel prices in New York harbour have tumbled 70% since the start of 2014, to 92 cents a gallon Tuesday. Prices hit 81 cents Jan 20, the lowest since Dec 2003. One reason why base fares haven’t fallen more: Collapsing oil prices haven’t triggered a major economic slowdown, which typically would quash demand. Airlines also are taking advantage of the lower costs to pay dividends, repurchase shares, reduce or refinance debt and add capacity. The average domestic fare should fall less than 1% in 2016. <br/>
https://portal.staralliance.com/cms/news/hot-topics/2016-01-28/general/us-airlines-reap-benefits-from-cheaper-fuel-consumers-not-so-much
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US: Airlines reap benefits from cheaper fuel, consumers not so much
Consumers have benefited somewhat from the lowest jet-fuel costs in more than 12 years, but not nearly as much as the companies. While travellers are paying less on average for trips, base fares have remained essentially unchanged since 2014, according to CE Rick Seaney of FareCompare.com. Meanwhile, spot jet-fuel prices in New York harbour have tumbled 70% since the start of 2014, to 92 cents a gallon Tuesday. Prices hit 81 cents Jan 20, the lowest since Dec 2003. One reason why base fares haven’t fallen more: Collapsing oil prices haven’t triggered a major economic slowdown, which typically would quash demand. Airlines also are taking advantage of the lower costs to pay dividends, repurchase shares, reduce or refinance debt and add capacity. The average domestic fare should fall less than 1% in 2016. <br/>
