The president of the Aviba travel agencies association in the Balearics, Francesc Mulet, says that prices have been going up "with the excuse of the increase in fuel costs". Ferry operators, he notes, will follow suit; fuel accounts for some 80% of a ship's variable costs.
Mulet highlights increases in prices for flights to the Caribbean in particular. In general, he says, "the situation is going to get worse". Companies, whether airlines or shipping, cannot assume the rise in energy costs. They will not be able to use algorithms to camouflage price increases, specifically for mainland flights, for which airlines apply algorithms with higher prices that are camouflaged with the 75% residents discount.
Before the war in Ukraine and the pandemic, airlines were guaranteed up to 80% of the price of fuel from one year to the next in order to avoid distortions in their normal operations. For many airlines, this has dropped to 50% or below, which is why they are forced to increase prices.
The price of holiday packages to Mallorca and the Balearics is expected to increase because of fuel supplements. The war, Aviba says, has "shattered" price forecasting. The last thing airlines want is "for it to be known that prices are rising". But if the cost of fuel is not guaranteed, they have to make decisions that "negatively affect consumers and their own image".
With regard to the Balearic market, Mulet explains that travel agencies have been experiencing a slowdown in sales for European and long-haul flights for the Easter period, mainly due to the insecurity generated by the war and the increase in air fares.
Spanish airlines and shipping companies are now waiting for what may happen from March 29, which is when the Spanish government is due to announce measures to alleviate increases in prices.
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well 50 % of the cost on fuel is TAX so if the Gov is so worried then they should reduce the Tax burden on the PEOPLE !