The six brands of Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) -- Carnival Cruise Lines, Costa Cruises, Cunard Line, Holland America Line, Princess Cruises and The Yachts of Seabourn -- have announced that effective October 31, 2008, the existing fuel supplement will be eliminated for all new bookings on 2010 departures. At that same time, a price increase on 2010 sailings will become effective. Additionally, the company has established specific guidelines under which the current fuel supplement may be reimbursed to consumers for 2008 and 2009 voyages.
For 2008 and 2009 departures, if the price of light sweet crude oil according to the NYMEX (New York Mercantile Exchange Index) is $70 per barrel or less at the 2:30 p.m. close of business as reported by Reuters on each of the 25 consecutive trading days ending five trading days prior to the guest's cruise departure date, the fuel supplement will be refunded in the form of a shipboard credit. Guests who book a 2010 cruise prior to October 31, 2008, will be charged the current fuel supplement but will also be eligible for a refund of the fuel supplement in accordance with the same fuel price conditions that are being implemented for the 2008 and 2009 departures.
Bill Harber, director of marketing for Carnival Corporation & plc, said the company was implementing these initiatives due to the recent trends in declining fuel prices in an effort to migrate away from charging a separate fuel supplement. "If fuel prices stabilize below $70 a barrel, we will be able to effectively eliminate a separate fuel supplement." However, he cautioned that there is still a risk that fuel prices could move higher "which would require us to maintain or reinstate a fuel supplement but the company is hopeful that the goal of eliminating the fuel supplement can be achieved." Harber added that "these industry-leading initiatives demonstrate our commitment to our guests and travel agents to make our brands the most attractive cruise vacations available."
The fuel supplement for five of the six Carnival Corporation & plc brands is currently $9 per person per day for the first and second guest (not to exceed $126 per person per voyage) and $4 per person per day for third, fourth and fifth guests (not to exceed $56 per person per voyage). Seabourn's fuel supplement is $15 per person per day for the first and second guest (not to exceed $210 per person per voyage) and $4 per person per day for third and fourth guests (not to exceed $56 per person per voyage).