Will Cruise Line Fuel Surcharges Return?

June 10, 2009
Fuel Surcharges

Remember way back in 2008, when cruise lines made passengers foot the bill for skyrocketing fuel costs? After months of cheaper gas -- and surcharge-free cruising -- the price per barrel has crept up to nearly $72, a new high for 2009, and oil's recent ascension has the Cruise Critic message boards all abuzz.

Today, the message for concerned cruisers is that there is no intention to reinstate surcharges -- at least for now.

Chairman and CEO for Carnival Corp., Mickey Arison, issued the following statement, which applies to Carnival's six North American lines (Carnival Cruise Lines, Costa Cruises, Cunard Line, Holland America, Seabourn and Princess Cruises):

"At the time we suspended fuel supplements for our six North American brands [December 2008], we reserved the right to reinstate them if the price of light sweet crude oil, according to the NYMEX, should increase above $70 per barrel. While we have now exceeded that threshold, in light of the economic crisis and resulting consumer weakness, we presently have no plans to institute a fuel supplement. We will continue to monitor the situation in the markets and review our position as the situation warrants."

"We're monitoring the situation almost as closely as Cruise Critic readers," joked Carnival spokesman Tim Gallagher.

Additionally, Norwegian Cruise Line, Royal Caribbean Cruises Ltd. (parent of Royal Caribbean, Celebrity Cruises and Azamara Cruises) and Prestige Cruise Holdings, Inc. (Oceania Cruises, Regent Seven Seas Cruises) tell us they have nothing official to report in terms of reinstating the surcharges, which, as with Carnival Corp., were removed late last year as oil prices fell sharply.

However, all three have previously stated that they reserve the right to reinstate fuel supplements for all passengers under certain stipulations. For example:

Royal Caribbean reserves the right to reinstate fuel supplement charges if the price of West Texas Intermediate fuel exceeds $65 per barrel, on the quarterly milestone dates. The next milestone date is June 17, 2009, which would affect sailings occurring from July 1, 2009 through September 30, 2009. RCCL tells us that no official decisions have been announced regarding what will happen if oil is still above $65 on June 17.

NCL reserves the right to reinstate the fuel supplement for all guests should the price of light sweet crude oil according to the NYMEX increase above $65 per barrel.

Prestige Cruise Holdings, Inc. can reinstate fuel surcharges at any time -- they don't include a specific price of oil at which they can do so. "Right now we're doing nothing more than watching the price of oil," says Tim Rubacky, Senior Director of Corporate Communications for PCH. "Everyone's watching the price of oil closely, because from an economic standpoint, rising fuel prices will do nothing but stifle the recovery process. We'll do everything in our power to not have to reinstate them -- and hopefully things stabilize."

Stay tuned.

--by Dan Askin, Associate Editor