Tuesday, November 4, 2008

Regent Seven Seas and Oceania Announce End to Fuel Supplements

"Effective November 10, 2008, fuel supplement charges will be eliminated from all Regent Seven Seas Cruises voyages departing in 2010. In addition, the company has established specific guidelines under which the fuel supplement may be reimbursed to guests sailing on voyages departing in 2009.


"For voyages departing in 2009, the company will continue to apply a $15 per guest per day fuel supplement. Fuel supplement charge adjustments, if any, will be determined on a quarterly basis. Refunds, in the form of Shipboard Credits, will automatically be applied to all reservations to which a fuel supplement had previously been charged if the quarterly closing price on the New York Mercantile Exchange of West Texas Intermediate fuel is below $65 per barrel two weeks prior to the beginning of the upcoming calendar quarter.

"Frank Del Rio, Chairman of Prestige Cruise Holdings, parent company of RSSC, stated that the company was implementing these changes due to the recent decline in fuel prices. "If oil stabilizes below $65 per barrel, we are confident that we can effectively eliminate the need to charge our guests a separate fuel supplement. However, we must see stability in fuel pricing on a mid- to long-term basis as there could still be significant volatility in the marketplace," stated Del Rio."

I think what is implied, but not stated, is that Regent and Oceania - who have maintained the highest fuel supplement charges in the industry on both a per day and cruise total basis - will be adjusting their 2010 prices to incorporate a cushion against fuel increases as others have done.