Friday, October 24, 2008

Celebrity and Royal Caribbean to End Fuel Supplements

Effective November 10, 2008 Celebrity Cruises and Royal Caribbean Cruise Line will no longer charge fuel supplement for cruises scheduled to depart on or after January 1, 2010.

For 2009 and 2010 cruises booked prior to November 10, 2008 RCCL will determine on a quarterly basis whether fuel supplements will be refunded. Refunds, in the form of an onboard credit, will be provided if the closing price of West Texas Intermediate fuel is $65 or less, at the closing time of the New York Mercantile Exchange, two weeks prior to the beginning of the upcoming calendar quarter. When those conditions are met, an onboard credit will be provided to all guests on sailings that begin during the upcoming calendar quarter.


Put simply, adjustments will be made only four (4) times a year.  That will be done two weeks prior to the beginning of each calendar quarter.  So, for example, if on March 16, 2009 the price of oil is $65 those cruises departing during the period of April -June 2009 would have the fuel supplement refunded by way of an onboard credit.

This is a far less cumbersome formula than that being implemented by Carnival.  I think it may be a balancing between using an understandable method with some of the risk spread versus trying to be as accurate as possible.  I can't say that one is "better" than the other.  What I can say is that I am glad this is happening sooner rather than later.