Fuel surcharge

[buffett336]

Has Carnival started to add fuel surcharges to bills yet? Once oil cost $70 a barrel, (which it is now), Carnival can charge a fuel surcharge up to $9 a person per day.

[firefly333]

The only time I remember them doing it, oil was a lot closer to $150 a barrel, not $70.

 

They wouldnt charge imo just because it hit some threshold number because it might go up and down and if it didnt hold then they would have to refund all those guests and it would cost them more than if they didnt do it.

[chengkp75]

Though all the cruise lines have left the fuel surcharge in their contract terms, there is very little likelihood of their implementing the charge now, or in the foreseeable future. This was instituted at a time when oil prices were extremely volatile, and the lines were subjected to unpredictable fluctuations. Nowadays, they use fuel "futures" contracts to lock in prices for large blocks of fuel over time at fixed prices, which allows them to forecast fuel cost over a longer period and pre-set the cruise fares accordingly. Additionally, there is no direct correlation between crude oil price and marine fuel price.

[Micahs Grandad]

Though all the cruise lines have left the fuel surcharge in their contract terms, there is very little likelihood of their implementing the charge now, or in the foreseeable future. This was instituted at a time when oil prices were extremely volatile, and the lines were subjected to unpredictable fluctuations. Nowadays, they use fuel "futures" contracts to lock in prices for large blocks of fuel over time at fixed prices, which allows them to forecast fuel cost over a longer period and pre-set the cruise fares accordingly. Additionally, there is no direct correlation between crude oil price and marine fuel price.

 

I would think that they would be moving in the same general direction though

[shof515]

they add the fuel surcharge in with the cruise fare or port taxes. this is why cruises for the next few years is a bit higher then in the past

[chengkp75]

I would think that they would be moving in the same general direction though

 

Not always. While they have been tracking fairly closely over the last couple of months, since marine bunker fuel is a "by-product" of the refining process, the more demand for refined product goes up (gasoline, diesel, jet fuel), the more available bunker fuel is, so the price can drop. It also depends on shipping forecasts, and how much demand there is for worldwide shipping. While the cruise industry's appetite for fuel is fairly constant, it is also a fairly small segment of the industry.

[buffett336]

Just checking. Sailing in June and was hoping not to have a extra charge before going on boat.

[chengkp75]

Just checking. Sailing in June and was hoping not to have a extra charge before going on boat.

 

Well, if you ever have to get on a boat, they won't have time to charge you a surcharge, since the ship will be going down. :o

[Micahs Grandad]

Not always. While they have been tracking fairly closely over the last couple of months, since marine bunker fuel is a "by-product" of the refining process, the more demand for refined product goes up (gasoline, diesel, jet fuel), the more available bunker fuel is, so the price can drop. It also depends on shipping forecasts, and how much demand there is for worldwide shipping. While the cruise industry's appetite for fuel is fairly constant, it is also a fairly small segment of the industry.

 

Thanks for the explanation. Good to know

[Cushing985]

Well, if you ever have to get on a boat, they won't have time to charge you a surcharge, since the ship will be going down. :o

 

Thank you for this CHENG. Being retired from the Navy it makes me cringe when people refer to ships as boats.

[Joebucks]

For all of the "renewable energy" fanatics out there, I have a question. Why aren't any of these cruise ships solar powered, or at least a hybrid? The sun is plentiful on most cruises. Is Facebook lying to me how awesome it is?

[MBP1]

For all of the "renewable energy" fanatics out there, I have a question. Why aren't any of these cruise ships solar powered, or at least a hybrid? The sun is plentiful on most cruises. Is Facebook lying to me how awesome it is?

 

There really isn't much space on ships to put them and it just wouldn't be worth the investment. Take a look at an aerial view of a cruise ship, most of the exposed space is taken up by pools, decks and other passenger areas, leaving minimal room for panels.

[salty dingo]

Just because they can impose the surcharge does not mean they will. I would ignore this unless there is some announcement from Carnival.

[firefly333]

For all of the "renewable energy" fanatics out there, I have a question. Why aren't any of these cruise ships solar powered, or at least a hybrid? The sun is plentiful on most cruises. Is Facebook lying to me how awesome it is?

 

Oh please. I just heard calif is making new homes have solar, have to buy the parts from china and they cant get rid of the extra power they have now. They are giving money to other states to take their excess power per the news i just heard and now making even more people, even if their roof slants wrong or they have to cut down shade trees to do it.

 

please save me from mandated do gooders who want things to be law.

[jimbo5544]

Oh please. I just heard calif is making new homes have solar, have to buy the parts from china and they cant get rid of the extra power they have now. They are giving money to other states to take their excess power per the news i just heard and now making even more people, even if their roof slants wrong or they have to cut down shade trees to do it.

 

please save me from mandated do gooders who want things to be law.

Gotta love the United States of California.....

[chengkp75]

For all of the "renewable energy" fanatics out there, I have a question. Why aren't any of these cruise ships solar powered, or at least a hybrid? The sun is plentiful on most cruises. Is Facebook lying to me how awesome it is?

 

It's all about energy density. A ship is a very dense energy consumer (lots of power in a small area), while solar arrays are low density (large area to generate a small amount of energy). There is not enough total surface area on a cruise ship, let alone usable surface area, to generate a significant amount of power. I can't remember whether it was Oasis or Allure that had solar panels installed, and a rather large array was able to power the lights and such for the central promenade and that's about it. Nothing further has ever been heard of the project, and no further ships had solar panels installed. Cost to benefit wasn't there.

[riclop]

Has Carnival started to add fuel surcharges to bills yet? Once oil cost $70 a barrel, (which it is now), Carnival can charge a fuel surcharge up to $9 a person per day.

Don't start that again.

[Pellaz]

For all of the "renewable energy" fanatics out there, I have a question. Why aren't any of these cruise ships solar powered, or at least a hybrid? The sun is plentiful on most cruises.

 

Well, a one megawatt solar PV power plant requires about 100,000 sq ft of space; about 2.5 acres, or 1 hectare.

One cruise ship diesel generator (labeled "DG" on the wall display in Engineering Control, if you ever take the Behind the Fun tour) produces between 8 and 10 megawatts of power. If we go with 8 MW, that's about 20 acres of solar cells per DG.

Each ship has six DGs, although typically only four are running at any one time; one is kept in "ready reserve" and one is usually down for scheduled maintenance. Assuming 4 DGs are providing power, that's 80 acres of solar PV.

--During the daytime.

Nighttime might cause...issues.

 

So yeah, the ship will come up a LITTLE short on space. :)

 

Note there are other losses inherent in the system; this would be a best-case scenario.

ChEngKP, jump in if these figures are wildly off.

 

Is Facebook lying to me how awesome it is?

No way. They have a strict policy against promulgating fake news. :D

[pbfp2008]

Why not nuclear power then?

[buffett336]

Well f***ing excuse me. I was not in the Navy along with some a**holes. Just asking a question. Thanks to everyone else for their answer.

[grapau27]

Though all the cruise lines have left the fuel surcharge in their contract terms, there is very little likelihood of their implementing the charge now, or in the foreseeable future. This was instituted at a time when oil prices were extremely volatile, and the lines were subjected to unpredictable fluctuations. Nowadays, they use fuel "futures" contracts to lock in prices for large blocks of fuel over time at fixed prices, which allows them to forecast fuel cost over a longer period and pre-set the cruise fares accordingly. Additionally, there is no direct correlation between crude oil price and marine fuel price.

Thanks for enlightening us.

As always your information is extremely helpful.

 

Sent from my Kestrel using Forums mobile app

[chengkp75]

Why not nuclear power then?

 

In a consumer protection environment where you have to label a coffee cup "caution contents are hot" to prevent lawsuits, can you imagine the safety measures that would be required to have passengers in proximity to a nuclear reactor? Can you imagine the lawsuits 20 years after someone's last cruise, claiming that any form of cancer the passenger had was caused by proximity to the reactor?

 

And then the cost. While the fuel cost over the life of the ship would be small, the capital investment to install the reactor and the power plant would break the company. The US Navy, of course, doesn't need to show a profit, so capital expense is not a problem, and they "amortize" that cost over a much longer ship life than a commercial ship. This is why the only commercial ships ever powered by nuclear power (except the "concept ship" Savannah), were Russian, and all are retired except a few ice breakers, where getting fuel to them would be difficult.

[salty dingo]

The US Navy, of course, doesn't need to show a profit

Careful, you may dislodge all the "free market" thinkers here who think it should not be a burden on the taxpayers.

 

You know, if we engaged in more piracy we may be able to fund operations from the booty.

[gatour]

Thanks chengkp about the reason why ice breakers would be nuclear powered. I think there was a similiar discusion somewhere else on cruisecritic where you mentioned ice breakers. I have been trying to figure out why that would be so. When I saw your reasoning below, I was like duh.

 

It was Oasis that had solar panel at the time of launching.

 

This is why the only commercial ships ever powered by nuclear power (except the "concept ship" Savannah), were Russian, and all are retired except a few ice breakers, where getting fuel to them would be difficult.

[winddawn]

Well, if you ever have to get on a boat, they won't have time to charge you a surcharge, since the ship will be going down. :o

 

First World Problem.