Fuel price rise, fewer vacations in 2022?
After two years of Corona hardships, the vacation spirit is high. In the meantime, the war in Ukraine is causing uncertainty, and fuel prices are rising rapidly, making vacations in 2022 significantly more expensive. Fuel price rise, fewer vacations in 2022?
We don’t know the extent of the consequences of the war in Ukraine for a long time. After the two-year Corona travel standstill, this new uncertainty is a setback for the tourism industry. The first cancellations are arriving, and offers are still unanswered. Travel has again been halted, despite a well-planned resumption. Some people who were initially willing to travel abroad are reconsidering whether or not they should do so in the first place.
Travel-hungry people may feel that a vacation to the beach in 2022 is essential after two years without a coast. However, there are plenty of places to go far from the currently contested area. In addition, there is no problem travelling to almost any destination in the world via air today.
To begin planning a vacation, you have to ask yourself: plane, train, or car?
Travelling by train is quite popular and recommended for sustainable reasons. However, the cost of air and car fuel will increase substantially in the coming weeks/months, significantly impacting vacation budgets in addition to the environmental advantages of rail travel.
Cost of airline fuel: +80 % and more
As far as fuel surcharges are concerned, little has been heard from the airlines. Air Asia was the first airline to introduce a surcharge of $13 for flights over four hours. Many airlines are likely to follow this lead in the coming days, but the surcharge amount cannot yet be estimated. At the moment, there are many questions regarding how pricing will continue at the airlines.
Higher fuel prices will result in significantly fewer seats available at the lower fair rates. The airlines cannot be assumed to have hedged large quantities of fuel at lower prices, except for Ryanair, who hedged large amounts of fuel at lower prices. Ryanair’s CEO claims to have hedged 80% of the fuel supply needed for the company.
In the coming weeks, booking flights is likely to become more expensive for air travellers. Airlines can hardly offer special offers despite expanded flight offerings with current fuel prices. So should we switch to the car? Probably not.
Unleaded 95: plus 60%
The demand for car vacations in the two Corona years was very high – the risk of contagion is very low, and flexibility to return whenever required is excellent. The coasts of Croatia, Italy, Spain, France, or the nature of the north of Europe is easily explorable with a car or camper as a vacation vehicle in Europe. Vacations in Europe this year are mostly being taken by car.
Trips by car have become significantly more expensive overnight.
For example, a litre of unleaded 95 gasoline at a BP gas station in Zurich costs 2.29 Swiss francs. A year ago, unleaded 95 had a cost of 1.41 francs. In March 2022, a litre of gasoline will cost 62% more. Moreover, this price increase is unlikely reversible in the next few weeks. Quite the contrary: three-franc prices for litres suddenly seem plausible.
Furthermore, other companies may also consider this idea as airlines expect to add new fuel surcharges to balance the price hikes.
We still need time to check which companies will adopt the special surcharge in Switzerland. For example, will Uber Switzerland follow the surcharge for riders and deliveries, as they already did in San Francisco?
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