The Dreaded Fuel Surcharge

[elcuchio24]

 

CCL stock is down about 10% this morning, after a forecast cut for the rest of 2019......they are blaming that mostly on rising fuel costs.

 

Not to be an alarmist, but don't be shocked if the ol' Surcharge comes back into play if oil prices continue to rise.....

 

https://www.cnbc.com/2019/09/26/reuters-america-update-2-carnival-cuts-2019-profit-forecast-on-fuel-price-spike.html

[shof515]

as a shareholder, carnival stock been down for a very very long time. never seen this low

[elcuchio24]

2 minutes ago, shof515 said:

as a shareholder, carnival stock been down for a very very long time. never seen this low

 

For sure. I just picked up some more this morning. Seems oversold to me. We'll see!

[glrounds]

Over the years, when oil was much higher in the past, I've never seen Carnival invoke the surcharge.

 

[elcuchio24]

43 minutes ago, glrounds said:

Over the years, when oil was much higher in the past, I've never seen Carnival invoke the surcharge.

 

 

I believe the last time they implemented it was around 08-09 if I am not mistaken. Been a while for sure. 

[coevan]

2 hours ago, elcuchio24 said:

 

For sure. I just picked up some more this morning. Seems oversold to me. We'll see!

 

 

brokers are listing it as a hold

[elcuchio24]

23 minutes ago, coevan said:

 

 

brokers are listing it as a hold

 

you always do what the broker tells you? 😉

[xDisconnections]

2 hours ago, shof515 said:

as a shareholder, carnival stock been down for a very very long time. never seen this low

Still much higher than when I purchased...

[glrounds]

1 hour ago, elcuchio24 said:

 

I believe the last time they implemented it was around 08-09 if I am not mistaken. Been a while for sure. 

 

November 2007

https://www.expertcruiser.com/blog/carnival-implements-fuel-surcharge-of-5-per-person-per-day/

[urbanhawk]

1 hour ago, elcuchio24 said:

 

I believe the last time they implemented it was around 08-09 if I am not mistaken. Been a while for sure. 

My 2nd cruise was in 11-07, to the Southern Caribbean, out of San Juan. My entire cruise was paid for, but since the oil  was over $70.00 a barrel, the dreaded fuel surcharge was added.This is to the best  of my knowledge. I don't know how long it was imposed for.

[martinchem]

Last time the cruise lines tried to implement a fuel surcharge in the US it blew up in their face.  Guests canceled so many cruises it caused them to pull back the surcharges and reduce prices just to fill the ships. That's when they started offering non refundable deposits to discourage future cancellations. I don't think they would want to go that route again. 

[rwilk1129]

I remember paying the surcharge on several cruises back in the day. Been glad oil has been down for so long.

[jimbo5544]

24 minutes ago, martinchem said:

Last time the cruise lines tried to implement a fuel surcharge in the US it blew up in their face.  Guests canceled so many cruises it caused them to pull back the surcharges and reduce prices just to fill the ships. That's when they started offering non refundable deposits to discourage future cancellations. I don't think they would want to go that route again. 

For the record, the nonrefundable pricing was  put in place as a stabilizer for pricing, while fuel surcharge may have been small part, it was mostly to solve late cancellations.  While some think it was a bad thing, it actually ended up helping the cruise line and clients, with stable balanced pricing. 

[ontheweb]

45 minutes ago, xDisconnections said:

Still much higher than when I purchased...

Same here. Plus the dividend has risen since then.

[RjayB]

Just FYI, it was lower at the end of August than it is now.  Not by much though.

[cathyz]

We had set up a group cruise (30+) way back when, Carnival decided to add the fuel surcharge, but it was inconsistent in our group, some were charged and some weren't so they ended up removing all of them, in the end we didn't pay.

[TEXSUN46]

I keep up with oil prices daily as we get royalties on mineral rights we hold and I have not been seeing crude prices going up at all, and actually are down significantly from what they were a year ago. There are times refined fuel will go up for various reason but usually only temporarily if it is not from rise in crude prices. 

[Decali]

That's what I was thinking. Does anyone know what oil price index they use for this and at what price the surcharge kicks in?

[rvsullivan]

Most lines use $70 per barrel as a trigger.

[coevan]

7 hours ago, elcuchio24 said:

 

you always do what the broker tells you? 😉

 

 

 

I never used a broker. I use Fidelity but read financial news. BTW the article on Carnival says they exceeded their expectations for the quarter.

[elcuchio24]

11 hours ago, coevan said:

 

 

 

I never used a broker. I use Fidelity but read financial news. BTW the article on Carnival says they exceeded their expectations for the quarter.

 

Yep, thats why I am comfortable buying more...

[NCTribeFan]

I'm not going to worry about a fuel surcharge until it happens and probably won't then  If it does, it does.  I have too many other things that I can control to waste any energy thinking about something that may not happen.

 

I bought at $21.  Glad I did.  I've received a whole lot of OBC since then.  I bought it as an investment, not to get some OBC, but what I've received has certainly been nice.

[Joebucks]

Unless there is some world wide emergency with fuel, and everyone does it, I don't ever see Carnival bringing back the fuel surcharge. It would be a PR disaster, worse than before. You can raise rates by $150, and no one would bat an eye. If they added a $80 separate line charge, well than that is the worst thing that could ever happen.

[richfret]

Every time I listen to the TV news and there is the mention of an oil issue, the price at the gas pumps jumps up immediately and stays that way for a few days.  Then the price comes down and we wait for the next problem.  It's a nice way to make a few extra bucks and gives justification for the action taken.  I look at it the same way with the oil surcharge.  If need be, it can be established and difficult to dispute.  After all, we saw it in the news so it has to be true.  Then the problem goes away.  The surcharge is removed and every one is happy again.  It's called economics in a strange sort of way. 

[jimbo5544]

17 minutes ago, richfret said:

Every time I listen to the TV news and there is the mention of an oil issue, the price at the gas pumps jumps up immediately and stays that way for a few days.  Then the price comes down and we wait for the next problem.  It's a nice way to make a few extra bucks and gives justification for the action taken.  I look at it the same way with the oil surcharge.  If need be, it can be established and difficult to dispute.  After all, we saw it in the news so it has to be true.  Then the problem goes away.  The surcharge is removed and every one is happy again.  It's called economics in a strange sort of way. 

Shake, bake and sizzle, all part of the game.   I doubt they would do another surcharge unless the crude went way up.  Even in that case, it would be surprising to have one line do it and others not.