TORONTO — The price of fuel is going up – way up – and travellers are about to feel the burn.
Rising tensions in the Middle East are pushing global oil prices higher, adding fresh pressure to already elevated airfares and complicating the outlook for cost-conscious Canadians.
Jet fuel remains one of the largest expenses for airlines, which according to IATA, surged 116% in cost year-over-year for the week ending March 27. With climbing prices, a growing number of carriers are adjusting fares, like Porter Airlines, Air Transat and WestJet, which have introduced $40, $50 and $60 surcharges, respectively. Air Canada Vacations, the tour operating arm of Air Canada, also implemented a $50 per passenger fuel surcharge on warm-weather packages.
Combined with strong summer demand and ongoing operational costs, the result is a pricing environment where true bargains are harder to find.
Even so, industry experts say opportunities still exist for Canadians willing to be flexible.
“Although we’re not seeing widespread decreases in airfares right now – with jet fuel costs rising, there’s broad upward pressure on fares – what we are seeing are pockets of relative value,” says Heather Smith, Location Manager & Travel Expert at Flight Centre Canada.
“This is particularly true in destinations just outside peak demand or with more flexible routing like secondary European cities or alternative gateways like Bologna instead of Venice, or Lyon instead of Paris,” she adds.
Seasonality is also creating opportunities. “Sun destinations like Mexico and the Caribbean tend to offer better pricing in the summer months, as demand shifts toward Europe. For travellers with flexibility, that can be a good opportunity to find value,” says Smith.
AIRLINES & DYNAMIC PRICING
From an airline perspective, pricing remains highly dynamic, influenced by a range of factors beyond fuel alone.
“Airfares move daily and can vary significantly depending on travel dates, demand and available capacity,” Sebastian Ponce, Chief Revenue Officer at Transat, tells Travelweek. “In the current cost environment, like the rest of the industry, pricing is also influenced by input costs such as fuel.”
Despite these pressures, Ponce says value can still be found for those who plan strategically.
“Travellers and advisors will find pockets of value depending on the travel window. Our focus remains leisure travel, and we continue to work hard to offer competitive pricing and strong overall value, including reliable air service and well-established tourism infrastructure, especially when clients are flexible on dates and book during promotional periods.”
NEW ROUTES CREATE PRICING OPPORTUNITIES
New routes and promotional offers are another avenue for savings, particularly for travellers open to trying different airports or destinations.
According to Porter spokesperson Brad Cicero, introductory pricing can offer meaningful savings.
“In Porter’s case, introductory pricing is often lower for new routes,” he says.
One current example, he notes, is promotional pricing tied to the upcoming opening of Montréal Metropolitan Airport (MET), where Porter is expanding service.
“The most notable example is the current promotional pricing on all routes to and from Montreal Metropolitan Airport until April 7, for travel by June 24,” says Cicero, noting the airline will operate 12 routes across Canada from the airport this summer.
He adds that upcoming route launches to destinations like Boston, Nashville and Austin also present opportunities for lower fares during initial sales periods.
FROM CHEAP TO VALUE
For travel advisors, the current environment requires a shift in how value is communicated to clients.
“The focus has shifted from ‘cheap’ to value and strategy,” says Smith.
That includes steering clients toward alternative gateways, secondary cities and more flexible itineraries that may combine air and rail. Less saturated destinations can also offer better pricing while delivering more immersive experiences.
“There’s a real opportunity for advisors to guide clients toward better-value experiences, not just lower prices,” she adds.
FLEXIBILITY IS KEY
When asked what advice she would give to travel advisors with clients looking for a deal, Smith recommends looking for alternative gateways and secondary cities, exploring beyond major hubs and opting for emerging or less saturated destinations.
Flexibility, she adds, is the most important factor in securing a good deal.
“In the near term, pricing is still adjusting as airlines respond to higher fuel costs, and those changes are often phased in,” says Smith. “The key message is urgency and flexibility – booking earlier and being open on dates, routing or destination is the best way to secure value. In this environment, today’s price is often the best available.”
While geopolitical uncertainty and rising costs are expected to persist in the short term, the message from across the industry is clear: affordable options haven’t disappeared, but they do require a more strategic approach.
