We saw the drama unfold earlier this year as record fuel prices bankrupted several carriers and put many others in critical financial condition. To avoid catastrophic losses, airlines began the equivalent of looking under the furniture cushions for extra coins. They found plenty and introduced a wide variety of add-on fees, including fuel surcharges. The price of fuel is dramatically lower but the fees are here to stay, and the one charge that literally bears the word fuel is having less to do with the price of oil and more to do with making up for lost time – and revenue.

Like a clothing size label you may not want others to see, airlines are slowly peeling off the word fuel from recently-added surcharges and keeping them in place, despite a reprieve from the industry-threatening oil price hikes this summer. Carriers that told us that these increases were necessary because of fuel prices are now saying that they're retroactively necessary because of global economic worries. Some airlines contend that many of the surcharges were not in place when the price of a barrel of oil hit a record high, so they're now looking to make up for the missed opportunity to replace lost revenue. In other words, don't get hung up on what the surcharge is called and simply get used to the fact that fares to many destinations will continue to be higher as a result.

Some carriers, realizing the public relations impact of trying to tie price increases to the cost of fuel, have adjusted their surcharges downward in accordance with market oil prices. Carriers including Air France-KLM, Qantas and Cathay Pacific have announced surcharge reductions. Some airlines in North America are doing so on some but not all routes. In Canada, rival airlines Air Canada and WestJet took different approaches. The latter insisted on eliminating the surcharge entirely while Air Canada adjusted the base price of its tickets to accommodate the "elimination" of the fuel surcharge.

The airlines defend their tactics by insisting that the price of oil is still volatile and could go up dramatically at any time. Compared to 2007, the price of fuel is still high; nearly double the price in some cases. With passenger demand weakening in the face of a global recession, airlines are feeling the pressure to keep the surcharges in place and only modestly tweak them when necessary. Interestingly, these adjustments are being made selectively and not across the board, with some reductions more significant than others.

According to a report in USA Today, air travelers are still paying hefty fuel surcharges on round-trip international tickets and most surcharge reductions are being applied to discount tickets for leisure customers and not to premium fares. The newspaper provided a snapshot for 22 October, showing airlines with the cheapest economy fares for some routes, the ticket's fuel surcharge, and the increase in the surcharge since 22 October, 2007.



A fuel surcharge snapshot for 22 October, 2008 vs. 2007

Route	Airline	Fuel Surcharge on 22 Oct.	% change from 2007
Los Angeles-Bangkok	Thai	$542	185%
Washington-Tokyo	All Nippon	$630	174%
Chicago-Dublin	American	$250	172%
Los Angeles-London	Delta	$366	161%
Minneapolis-London	KLM	$366	161%
Washington-Dublin	Aer Lingus	$237	158%
New York-Dublin	Delta	$230	150%
Chicago-Tokyo	American	$506	134%
Houston-Tokyo	Continental	$506	134%
New York-Tokyo	American	$506	134%
Philadelphia-London	US Airways	$266	122%
Chicago-Brussels	American	$330	94%
Chicago-Madrid	American	$330	94%
Los Angeles-Beijing	Air China	$330	94%
Los Angeles-Shanghai	China Eastern	$330	94%
New York-Madrid	Delta	$330	94%
Houston-London	Continental	$266	90%
Chicago-Zurich	Swiss	$300	76%
Los Angeles-Zurich	Swiss	$300	76%
New York-Zurich	American	$300	76%
Washington-Zurich	United	$300	76%
Minneapolis-Tokyo	Northwest	$400	74%
Houston-Amsterdam	Northwest	$280	65%
Minneapolis-Amsterdam	Northwest	$280	65%
New York-Beijing	Air China	$330	65%