Can Oil Producers Like Talos Energy Brighten Summer Travel for Consumers?

0
131

Since the price of oil impacts many industries throughout the developed world and beyond, it is no wonder that tourism industry analysts are keeping close watch on prices per barrel of oil during America’s summer travel season. Crude oil prices have remained uncharacteristically low during the last few years, and the current price is about $47 per barrel. Sustained low oil prices eventually result in lower gas prices. Here are some ways that these low oil prices are expected to impact summer leisure travel on major modes of transport.

Low Oil Prices and Air Travel

Even with the inconvenience of navigating through airport congestion and the uncomfortable pat downs by security, many people are tempted to take off on cross-country flights for exciting travel destinations this summer. When they hear about low crude oil prices, they naturally get excited since the jets that they anticipate traveling upon are well-known gas hogs. However, recent airline data serves them up a sobering reality check more often than discounted fares on plane tickets. According to a USA Today article, the price of airline tickets will not be lowered in response to falling oil prices since airlines use their excess profits to upgrade their planes and pay their shareholders. On the bright side, air passengers who plan to rent cars at their destinations will benefit from lower gas prices.

Low Oil Prices and Summer Travel by Sea

When crude oil prices soared to $100 per barrel about a decade ago, cruise line operators went into aggressive, cost-cutting mode. The huge passenger vessels, which accommodate thousands of travelers and supporting crew members, use vast amounts of fuel to transverse oceans, seas and rivers. After placing a fuel surcharge on passenger fares as a first-line, risk mitigation tactic, these companies cut ports of call, modified itineraries and outfitted their ships with energy-conserving upgrades. Now that fuel costs have decreased, cruise lines can make some positive changes for their customers. While significant price reductions on fares are possible, cruise patrons will likely see greater diversity in the available ports of call and itineraries for their trips. The fuel surcharge may also go away according to cruise industry insiders.

Low Oil Prices and Classic Summer Road Trips

Fallen oil prices have inspired many families to make the most of their vacation dollars by taking classic, cross-country road trips this summer. This mode of summer vacation travel may be the best-value option in light of the world’s low oil prices that have already trickled down to the prices paid by consumers at the pump. Budget travelers can fill up their own vehicles’ tanks and drive to scenic, thematic or temperate destinations for a temporary escape from their routines. Others can take advantage of the discounted gas prices to rent luxury recreation vehicles in which they can stop and tour travel destinations in absolute comfort and convenience.

Low Oil Prices and Other Modes of Travel

Other modes of travel such as rail and buses are also impacted by low oil prices but to a much lesser extent than the above-described means of travel. For instance, many bus lines use cleaner energy fuel sources such as natural gas to transport their customers around town and across the country. Amtrak, America’s most famous passenger rail line, uses a combination of electricity and diesel fuel to power its trips. The rail line has had fiscal issues since its inception over 40 years ago, and its practice of raising ticket prices every year is well known. While Amtrak will likely not lower its fares for customers even if the world’s oil prices equate to cost savings on their diesel fuel, the incredible views and comfort of train travel are often well worth the cost.