As Gasoline Goes...

[jimntx]

I was cleaning out my email Inbox this am and found this from Friday's New York Times. If it has already been posted by someone else, I apologize. You may have to register, but it is free.

U.S. Report Sees Gasoline Prices Moving Higher Still

WASHINGTON, April 7 - The government projected on Thursday that gasoline prices would surge even higher in coming weeks and remain high through the summer, a forecast underscoring both the economic effect of the sharp rise in energy costs and growing political risks for President Bush.

The Energy Information Administration, an arm of the Energy Department, said it expected the price of unleaded regular gasoline to hit a peak national average of $2.35 a gallon in May and to average $2.28 from April through September. Last week the average price was $2.22.

The complete article

 

[jimntx]

Crude up at $53.75/bbl at 1000 ET. Boy, it looks like we've got OPEC on the ropes now!

 

[Seatacus]

Why is it so hard for airlines to pass along the higher cost of jet fuel????? We all need to raise fares. Even with higher fares the public I think would still opt to fly compared to driving. :blink:

 

[FWAAA]

Why is it so hard for airlines to pass along the higher cost of jet fuel????? We all need to raise fares. Even with higher fares the public I think would still opt to fly compared to driving. :blink:

[post="261982"][/post]​

Primarily because the price of airline tickets has very little to do with the cost of inputs. Practically nothing, in fact. Doesn't matter if oil were $10 or $100.

If fares could be raised to cover fuel, then why weren't fares raised to cover wages instead of slashing them?

Do fares go up when your airline ordered new, expensive airplanes?

Airline fares are where they are because of overcapacity; too many legacy seats chasing a smaller pool of customers who want to fly legacy airlines.

Couple of bankrupt airlines fold, and some of that overcapacity goes away. Econ 101.