|by Jason Steele|
Being a travel expert has the effect of attracting the interest of friends and family when they need assistance booking air travel. By business standards, I am no longer a frequent traveler, but through assisting others I still manage to keep up with trends in airfare.
Prices Are Rising
In the last month, I have seen prices rising rapidly all over the globe. A flight in Europe that I had priced out at $75 in February was over $200 by March. A domestic flight I took last month that was pricing at $225 is now pricing at $375. Current oil prices cannot account for this dramatic swing in airfares. It is the fear of future oil prices that is creating panic at airlines around the world. Beyond just raising airfares, they are planning capacity reductions. These are either relative reductions, meaning fewer new flights, or absolute reductions of seats. In this way, airlines are hoping to increase pricing power and maintain profits.
There is no doubt they are seizing on world events, from Japan to the Middle East, to predict future oil price increases and a downfall in business travel. Who can say if these fears will prove unfounded, but the reality of higher airfares is with us for the time being. When you add to that the seasonal tendency for oil prices to rise in the spring and summer, it is clear that prices are going up before they go down.
What You Should Do
If you have been holding from ing tickets for a trip later this year in the hope of finding a lower airfare, don’t. Certainly, you should look into ing tickets soon for any travel between now and the fall, when fares often recede. If you can book on Southwest, this is a no-brainer, as they will allow you to rebook lower fares with no penalty. If the fare on your flight goes down, you will receive the difference back as a credit towards a future flight. With Southwest, you have nothing to loose by booking. This is not true with other airlines which typically charge $150 as a change fee, making all but the most dramatic price drops not worth booking.