Fuel surcharges

[Parsman]

I have read on some websites (but not Fred. Olsen's) that Fred. Olsen has introduced a new form of fuel surcharge. Rather than a standard charge it will be a percentage (5.5%??) of the fare after all discounts. Whilst I understand the need for a surcharge at the moment with high fuel prices this seems very steep. It would be interesting to learn if this information is correct. :confused:

[simonpjd]

It was in the press over the weekend. Bunker fuel has gone through the roof so it is no surprise. I believe this is only for new cruises and will not be applied to any bookings already made.

If I am wrong please SHOUT VERY LOUDLY at me.

[Dartmoordan]

I already posted this, it's supposed to start on 19th January, personally I think it's a very unfair way of charging as the higher grade of cabin you book the more you pay, yet you are all using the same amount of fuel. Whilst a surcharge may be necessary due to the rising cost of oil surely the charge should be standard for all passengers:confused:

[Parsman]

The news is worse than I first thought. It applies to cruises already booked. 4.5% will be levied of the price of the cuise less any Fred. Olsen discounts eg Oceans. The more expensive the cabin the more you pay.

These charges have been imposed before but not on cruises already booked.

The only for me is that the price of Brent crude drops significantly before I go on a long cruise in early 2012. :mad:

[Dartmoordan]

The news is worse than I first thought. It applies to cruises already booked. 4.5% will be levied of the price of the cuise less any Fred. Olsen discounts eg Oceans. The more expensive the cabin the more you pay.

These charges have been imposed before but not on cruises already booked.

The only for me is that the price of Brent crude drops significantly before I go on a long cruise in early 2012. :mad:

 

 

I have not heard anything to say it affects cruises already booked, we have paid our final balance and have not recieved anything to say we need to pay more. I will not be happy if the surcharge appears on our final shipboard account without prior notice.:mad:

[CRUISIN LINDA]

The news is worse than I first thought. It applies to cruises already booked. 4.5% will be levied of the price of the cuise less any Fred. Olsen discounts eg Oceans. The more expensive the cabin the more you pay.

These charges have been imposed before but not on cruises already booked.

The only for me is that the price of Brent crude drops significantly before I go on a long cruise in early 2012. :mad:

 

Just found this;-

 

"No surcharges will be made less than 30 days before the cruise holiday is due to begin but bookings received within this period may be charged at the published price plus the surcharge. A significant decrease in the cost of providing the cruise holiday may be passed on to you at the discretion of FOCL."

 

So as we are going in less than 30 days, surely this means we will not have to pay more?

 

I see it is "at their discretion" though whether they pay you back if things get cheaper!!!

[CRUISIN LINDA]

This is the whole page on Terms and Conditions:-

 

http://www.fredolsencruises.com/Terms-and-Conditions/Terms-and-Conditions

[berkshireboy]

I have just spoken to Fred Olsen and they have confirmed that a 4.5% surcharge will be added to all existing bookings for sailings after 30 April 2011 - this could, of course, increase if fuel costs continue to rise. Fred Olsen chose not to forward purchase fuel and their passengers will now pay the cost. We are booked on the Balmoral Dubai - Southampton leg on 2nd April so will not pay the surcharge. However, we have two bookings for 2012 [brazilian Amazon and Peru - Southampton] which will attract hundreds of pounds in surcharges. Should 20% VAT be added next year then we will cancel both of these cruises - at the moment we cannot without losing our deposits.

 

I am also unhappy with Fred Olsen because they cannot give any details of our flight arrangements to Dubai on the 2nd April other than it is with Thomas Cook from Gatwick. We had intended to book a hotel with airport parking but cannot do this until we know what time the flight checks in. If it is 4 or 5 am [which it could be] then there is no point in booking a hotel. If we use airport parking we have already lost the best deals for which you need to book more than three months in advance.

 

All these extra charges are making Fred Olsen look very expensive indeed. I can certainly see no point in early booking in future, if I use Fred Olsen again I'll wait for the late deals.

[SagaBrux]

berkshireboy, thanks for checking with Fred Olsen (I see that they have also updated their web site on this very recently (http://www.fredolsencruises.com/News/2011/Fuel-cost-update); when I checked at the beginning of this week, there was no information.

 

I understand that fuel is expensive, but what I don't understand is why this extra charge is a percentage of the price paid, instead of a flat rate. Surely, if we are on the same ship, on the same route, and thus use the same amount of fuel, the fee paid should be the same for everyone?

 

We are sailing on FO in 2012, and the price of our cruise (2 people) will increase by a very substantial 650 pounds.

 

Actually, is it even legal to extend this extra charge also to bookings already made? Well, I guess there must be small print somewhere allowing them to do this.

[historyman]

I have just spoken to Fred Olsen and they have confirmed that a 4.5% surcharge will be added to all existing bookings for sailings after 30 April 2011 - this could, of course, increase if fuel costs continue to rise. Fred Olsen chose not to forward purchase fuel and their passengers will now pay the cost. We are booked on the Balmoral Dubai - Southampton leg on 2nd April so will not pay the surcharge. However, we have two bookings for 2012 [brazilian Amazon and Peru - Southampton] which will attract hundreds of pounds in surcharges. Should 20% VAT be added next year then we will cancel both of these cruises - at the moment we cannot without losing our deposits.

 

I am also unhappy with Fred Olsen because they cannot give any details of our flight arrangements to Dubai on the 2nd April other than it is with Thomas Cook from Gatwick. We had intended to book a hotel with airport parking but cannot do this until we know what time the flight checks in. If it is 4 or 5 am [which it could be] then there is no point in booking a hotel. If we use airport parking we have already lost the best deals for which you need to book more than three months in advance.

 

All these extra charges are making Fred Olsen look very expensive indeed. I can certainly see no point in early booking in future, if I use Fred Olsen again I'll wait for the late deals.

 

Thank you for finding out this information and it appears that we will also escape the surcharge as our cruise on the Braemar departs 14 April.

 

Nonetheless as an Oceans gold member who thinks that the FO product is by and large very good, I am very disappointed both with this new policy - the introduction of a percentage rather than flat rate surcharge, the application to existing bookings and the poor communication of this new policy and its effect on customers. Like many others I do not see the logic of percentage increases, the retrospective application of surcharges will only serve to deter early bookers and at the very least FO should ensure that when such information is published it should be comprehensive and clear, which it was not.

 

I understand that FO are facing substantially higher costs, but so too are many of their customers. Whilst cruising is very enjoyable, it is not exactly a necessity and there is much competition for business. At a time of economic and other challenges which the industry faces, alienating your core customer base does not look like a good idea to me.

[shevlen]

http://www.fredolsencruises.com/News/2011/Fuel-cost-update

 

This is so vague and certainly makes no mention of when the surcharges are to take effect.

We are sailing next week and have had no communication whatsoever from FO about fuel surcharge. So if they put it on our onboard account, they will either have to whistle for it, or the gratuities budget will suffer.

[berkshireboy]

It would seem from what Fred Olsen have said so far on their method of calculating the surcharge that they intend to include the flight element and the APD in the charge. I have today sent an email to Fred Olsen asking them to clarify and justify the basis of the surcharge. This is an extract from that email which I hope is self explanatory. I will post Fred Olsen's response when I receive it.

 

I have two future cruises booked with you in 2012, M1203 and W120141 both of which include flights. Can you clarify whether you intend that the surcharge will be applied to the flight element of the cruise and to the APD? I can see no basis for you surcharging either the flight cost or the duty [and it is probably not legal anyway to unilaterally increase the APD - do you intend to pass on the extra to the government?]

 

It is ironic that when the Caribbean has been campaigning so strongly for a decrease in the tax charged to visit the islands you appear to be intending to increase it.

 

In respect of the flights the price charged by the airlines will have already included their own fuel surcharge [if any] so in effect I will be paying a double surcharge on the flight element.

[historyman]

Received a letter from FO this morning stating that the surcharges will apply for departures from 10 April 2011..so as we leave on 14 April we will caught by them

[cannockfrodo]

We leave on 10th April and we've had no communication from FO regarding this issue, but then we've already paid the full balance. That might make a difference I suppose.

[cannockfrodo]

Fuel cost update

 

19 Jan 2011

Due to the escalating price of oil fuel, FOCL has reviewed the impact on its operating costs.

 

To date, forward 'fuel supplements' have been added to new bookings on a flat daily rate basis. However, the need also to levy a 'fuel surcharge' on existing bookings has necessitated a re-think on this policy.

 

The EU Package Travel Directive requires any surcharge to be related pro-rata as a percentage of the fare paid -- thus it would be impractical to maintain two different sets of charges for past and new bookings.

 

Both 'supplements' and 'surcharges' will now conform with the EU Package Travel Directive legislation and ABTA's guidelines.

 

The 'fare paid', on which extra charges are calculated, is the net invoiced fare after reductions, such as Oceans discounts or future cruise discount voucher values.

 

Should Brent crude oil prices fall back to the benchmark level used to calculate prices for Fred.Olsen Cruises Worldwide 2011/2012 brochure, then a refund will be applied by way of an on-board credit.

[simonpjd]

At the end of 2009 Bunker fuel in Rotterdam was trading at around $450/MT. Oil is very volatile and during Dec 2009 it varied between 425 and 460 or so.

The same fuel is trading today at around $510/MT so the price is up around 15% in the last 13 months.(very approx - am just doing rough figures here)

Given that a ship like the Balmoral probably burns around 30 tonnes a day at sea that gives fuel costs of about $15300 a day. In Dec2009 that would have been around $13500 so quite an increase.

However I am sure FO are also doing things like reducing speed a tad which saves a lot of fuel.

I have guessed the fuel consumption of the Balmoral but I wont be far away. Has anyone any hard stats on this so we can do a more complete estimate of costs. But the prices I quote are correct.

It does not seem to be a massive increase in price - smaller than I expected as some oil products have doubled in that time. Maybe they were hedging on the futures fuel oil markets before that and had locked in a smaller price for all of 2010.

I wonder what the price is that they say if it falls below then the surcharge will disappear - but they seem to be basing that on the price of Brent. Brent this morning is around $98 a barrel - very high especially as we pay in GBP and the conversion from to USD is not favourable right now.

Either way we sail at end May and have received a carefully worded letter saying we will be paying more.

[Parsman]

At the end of 2009 Bunker fuel in Rotterdam was trading at around $450/MT. Oil is very volatile and during Dec 2009 it varied between 425 and 460 or so.

The same fuel is trading today at around $510/MT so the price is up around 15% in the last 13 months.(very approx - am just doing rough figures here)

Given that a ship like the Balmoral probably burns around 30 tonnes a day at sea that gives fuel costs of about $15300 a day. In Dec2009 that would have been around $13500 so quite an increase.

However I am sure FO are also doing things like reducing speed a tad which saves a lot of fuel.

I have guessed the fuel consumption of the Balmoral but I wont be far away. Has anyone any hard stats on this so we can do a more complete estimate of costs. But the prices I quote are correct.

It does not seem to be a massive increase in price - smaller than I expected as some oil products have doubled in that time. Maybe they were hedging on the futures fuel oil markets before that and had locked in a smaller price for all of 2010.

I wonder what the price is that they say if it falls below then the surcharge will disappear - but they seem to be basing that on the price of Brent. Brent this morning is around $98 a barrel - very high especially as we pay in GBP and the conversion from to USD is not favourable right now.

Either way we sail at end May and have received a carefully worded letter saying we will be paying more.

 

A very interesting and constructive approach. The two factors in FOCL's policy are the price of Brent crude and the volatile £/US $ exchange rate. I accept that Brent crude is a reaonable base line but I'm not sure that passengers should bear the brunt of exchange rate variaitions. I hope Fed. Olsen respond to this thread.

[cannockfrodo]

Had the letter today !

£112 increase in cruise cost.

Took legal advice and if they've put in the booking small print that they can do this...........then they can :mad:

 

Tipping in advance ??? hmmmmm

[berkshireboy]

Fred Olsen have now replied to the email I sent them over the weekend as follows-

 

"Crude oil prices have consistently risen in price during the latter part of 2010 and this has had a significant impact on the operating costs for Fred. Olsen Cruise Lines. The cost of fuel represents a major element of the overall operating costs for the business. As a result, Fred. Olsen Cruise Lines have implemented a fuel surcharge on bookings previously taken. Although at present, operating costs have currently increased by 6.5%, in accordance with the Package Travel Regulations and notification to ABTA, the company intends to absorb the first 2% of the increase and implement a fuel surcharge of 4.5% on the cruise fare.

 

At the moment surcharges are being advised by way of a revised invoice approximately 12 weeks prior to cruise departure with a covering letter detailing the percentage used. We cannot advise of surcharge percentages more than 12 weeks before departure as this will be dependent upon the cost of Brent Oil at that time.

 

Where a surcharge has been imposed, and should the price at which Brent Oil trades (on average) fall below the £45.00 per barrel during the month before departure, Fred. Olsen will refund the surcharge paid by way of your on board account.

 

The surcharge is proportionate to the price of the cruise paid, for example if paid £1,000 – it will be £45.00, if paid £1,500 – it will be £67.50.

 

I cannot comment on individual cruise lines but the recent oil price increase has had a severely detrimental effect on the operating costs for Fred. Olsen Cruise Lines.

 

Should you wish to familiarise yourself with more detailed information on 'Surcharges' please refer to our Terms and Conditions on page 170 and 171 of our brochure, item 4.2. "

 

Clearly Fred Olsen are going to surcharge the full invoiced cost including flights and passenger duty come what may. Many Fred Olsen customers are not the most IT literate of cruisers and by not informing passengers about the surcharge until 12 weeks before the cruise departure many passengers will be unaware that there is a surcharge, let alone the amount or that it applies to existing as well as future bookings. No mention on their website that the surcharge is currently 4.5% and that this could well increase [and probably will, although not to the 10% which would allow the cruise to be cancelled without cost] which I think would be a more honest way of dealing with the situation.

 

However, there is little that anyone like myself can do about the situation except not to book future Fred Olsen cruises earlier than 8 weeks before departure and to cut expenditure on board in line with the cost of the surcharge. For instance, in my case not booking Fred Olsen shore excursions is an obvious means of clawing some of the surcharge back. I won't cut back on gratuities however as I feel that crew shouldn't bear the brunt of Fred Olsen's failure to hedge their fuel costs adequately.

[amberline]

We cruise on 10th april and recived the letter this morning, think it very unfair as we have already paid the balance in full but we have no choice but to pay it, they have said if fuel prices come down it will be refunded. I am not holding my breath

[historyman]

Fred Olsen have now replied to the email I sent them over the weekend as follows-

 

"Crude oil prices have consistently risen in price during the latter part of 2010 and this has had a significant impact on the operating costs for Fred. Olsen Cruise Lines. The cost of fuel represents a major element of the overall operating costs for the business. As a result, Fred. Olsen Cruise Lines have implemented a fuel surcharge on bookings previously taken. Although at present, operating costs have currently increased by 6.5%, in accordance with the Package Travel Regulations and notification to ABTA, the company intends to absorb the first 2% of the increase and implement a fuel surcharge of 4.5% on the cruise fare.

 

At the moment surcharges are being advised by way of a revised invoice approximately 12 weeks prior to cruise departure with a covering letter detailing the percentage used. We cannot advise of surcharge percentages more than 12 weeks before departure as this will be dependent upon the cost of Brent Oil at that time.

 

Where a surcharge has been imposed, and should the price at which Brent Oil trades (on average) fall below the £45.00 per barrel during the month before departure, Fred. Olsen will refund the surcharge paid by way of your on board account.

 

The surcharge is proportionate to the price of the cruise paid, for example if paid £1,000 – it will be £45.00, if paid £1,500 – it will be £67.50.

 

I cannot comment on individual cruise lines but the recent oil price increase has had a severely detrimental effect on the operating costs for Fred. Olsen Cruise Lines.

 

Should you wish to familiarise yourself with more detailed information on 'Surcharges' please refer to our Terms and Conditions on page 170 and 171 of our brochure, item 4.2. "

 

Clearly Fred Olsen are going to surcharge the full invoiced cost including flights and passenger duty come what may. Many Fred Olsen customers are not the most IT literate of cruisers and by not informing passengers about the surcharge until 12 weeks before the cruise departure many passengers will be unaware that there is a surcharge, let alone the amount or that it applies to existing as well as future bookings. No mention on their website that the surcharge is currently 4.5% and that this could well increase [and probably will, although not to the 10% which would allow the cruise to be cancelled without cost] which I think would be a more honest way of dealing with the situation.

 

However, there is little that anyone like myself can do about the situation except not to book future Fred Olsen cruises earlier than 8 weeks before departure and to cut expenditure on board in line with the cost of the surcharge. For instance, in my case not booking Fred Olsen shore excursions is an obvious means of clawing some of the surcharge back. I won't cut back on gratuities however as I feel that crew shouldn't bear the brunt of Fred Olsen's failure to hedge their fuel costs adequately.

 

I think this about sums up my reaction to the surcharge. When I buy a cruise or indeed anything else I do rather like to know how much it is going to cost. Of course we should all have read the terms and conditions before, but we know the rules of the game now.

 

So if I was considering booking in advance in comparing prices I would take the price and add 10% because this is the amount that could be added before a right to cancel. Better still leave it late and then you will know how much it is going to cost without second guessing. This is not a theoretical point. Before this news broke we were considering booking a future cruise and the surcharge that we will now have to pay would have gone some way towards the deposit.

 

The only extra that we always build into the basic cost of the cruise to ourselves are the recommended gratuities, and I agree it would be quite unfair to cut back on these. The staff and crew are a great asset to FO.

[monas queen]

Yet another "clarification", received by post today, and posted on the website yesterday.

 

At least they have now agreed to put a cap on the surcharge, but £250 is still a lot.

[historyman]

Yet another "clarification", received by post today, and posted on the website yesterday.

 

At least they have now agreed to put a cap on the surcharge, but £250 is still a lot.

 

We received this today along with a revised invoice with an additional £193 added for two in respect of our April cruise.

 

This so-called clarification which is really just tinkering with the new policy is a small step in the right direction by putting a cap of £250 per person and exempting the world and South America cruises and sectors thereof. People booked on these latter cruises will no doubt be very relieved.

 

I am still not happy about the retrospective application of any surcharges but we are where we are and will still enjoy the cruise.

[dun123das]

It was in the press over the weekend. Bunker fuel has gone through the roof so it is no surprise. I believe this is only for new cruises and will not be applied to any bookings already made.

If I am wrong please SHOUT VERY LOUDLY at me.

 

We have just been informed that we have to pay a £113 surcharge on our cruise staring on 23rd April, which was fully paid at the beginning of January. We have recently taken up an offer of an upgrade, which was paid for on 24th January, and the communication we received said that all cruises starting after 10th April will be affected.

[westmorland sailor]

We have just been informed that we have to pay a £113 surcharge on our cruise staring on 23rd April, which was fully paid at the beginning of January. We have recently taken up an offer of an upgrade, which was paid for on 24th January, and the communication we received said that all cruises starting after 10th April will be affected.

 

Ditto - we too paid early in January and then took the upgrade which on reflection is rather like shooting oneself in the foot. Just hope we don't get asked for more surcharges if the price of the oil rockets up any more. If this goes on, it is going to seriously undermine confidence in cruising because you will never know what price you are actually going to pay. Someone from Saga said as much this week. They are not imposing a fuel surcharge. Wipes away any discount you got in the first place also either by way of Oceans or Travel Agent perks.