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5 reasons $100-a-barrel oil would be good for travelers

November 7, 2007

With oil prices approaching $100 a barrel, air travelers — and for that matter all travelers — will be hearing a giant sucking sound when they pay for their tickets or fill up their gas tanks.

And you know what? That’s actually good.

Here are five reasons why high fuel prices are a positive thing for travelers.

1. Green isn’t an option anymore. I’m tired of the travel industry talking about being “green.” Airlines want to charge you extra to eliminate your carbon footprint. Hotels are giving “green” lip service by washing your towels less frequently (yuck!). One entire theme park, Universal Studios (great park, by the way) is going green, too. Please! You don’t issue a press release because you’re green. You just do it quietly because it’s the right thing for the environment — and for your guests. So the next time you see someone announcing, with great fanfare, that they’re “green,” imagine if a company said they were now going to be responsible. Or even, ethical. Sounds kind of absurd, doesn’t it?

2. Time to finally get serious about mass transit. Mass transit is regarded as the only long-term solution to our cities’ traffic problems. But no one wants to give up their cars, and so traffic has been getting progressively worse. With oil near $100 a barrel, owning a car is sure to become prohibitively expensive for some Americans, and that might be enough to encourage the development of viable mass transit systems in our cities. Taking cars off the streets is a good idea. It would also serve the interests of travelers, who would have an affordable way to get around the cities they visit.

3. Your kids will thank you. If you believe that fossil fuels are leading to global warming, and that global warming is going to change the planet forever, then you’ll agree with this next point. Pricier oil will lead us to find more environmentally-friendly alternative energy sources, and that means future generations will be able to live — and vacation — on a planet that look a lot like ours. Not some post-apocalyptic wasteland.

4. How ’bout an all-inclusive to Syria? No kidding. Higher fuel prices will hasten our efforts to find other energy sources, reducing our dependence on foreign oil. In the long run, that could potentially stabilize the Middle East, since Western interests would be far less like to, oh, I don’t know, invade a sovereign country and overthrow its government. Imagine the possibilities. Vacation in Iran, anyone? How about a cruise to scenic Iraq?

5. Say it with me: de-commoditization of airline tickets. What if — and this is a big “what if” — airlines have to raise their ticket prices? Big time. Ticket prices have not kept pace with inflation, and there’s some agreement among analysts that airline tickets have become “commoditized.” That means consumers will always buy the lowest-priced ticket. But if everyone had to charge more because of higher fuel prices, then it’s possible that passengers would become less price sensitive. They’d expect to pay a lot, and instead look to other areas like services and amenities, when they made a purchasing decision. That could improve air travel in a significant way.

I, for one, look forward to $100-a-barrel oil prices. It might lead to some real and positive changes in the way we travel.

Christopher Elliott is the author of Scammed: How to Save Your Money and Find Better Service in a World of Schemes, Swindles, and Shady Deals. Critics have called it “eye-opening” and “inspiring” — it’ll “grab your attention and won’t let go.” Order your copy now on Amazon, Barnes & Noble or iTunes.

11 comments

  • Jasper

    Unless a government mandates going green, no industry will do it on its own. Going green is a serious investment, and it will increase prices. Unless you have the money to do it (like Virgin owner Richard Branson), nobody is gonna do it voluntary. It is up to the government to level the playing field and force the entire industry to go green, so that the burden is the same for every one. So: nothing’s gonna happen. Not as long as republicans are running this country. And for those who hope democrats will change things. Stop hoping. They are also just playing lip service.

  • http://www.laurencarter.ca/blog Lauren

    Some great points and I couldn’t agree more. The travel industry seems to have their heads buried in the sand thinking that everything will be okay if they just sell enough carbon credits… I’m interested to see what will happen here in Toronto, where public transit prices just went up on the same day that a report was released that said that smog, gasp!, is killing people! I look forward to the day when people realize that travel has to change and start, in part, looking around at what they can do to make their hometown the destination they always dreamed about…

  • Lenny

    Commodity doesn’t mean “low-priced”. Commodity means “little or no product differentiation between suppliers”.

    No one can tell the difference between corn from Farmer Joe’s farm and corn from Farmer Jane’s farm. As a result, Farmer Joe’s and Jane’s corn costs the same. This held true when corn prices were low, as well as now, when corn prices are high.

    The same will be true with commercial flights. The product that the average consumer is purchasing from airlines is “carriage from point A to point B”. Does that consumer really care if it’s Delta or United carrying them? No, because air travel is a commodity. Consumer is going to arrive at point B either way, so he shops based on price alone.

    This would be true even if prices were higher. Higher prices aren’t going to change the fact that a trip from LGA to LAX is pretty much the same product, wither you fly on DAL or UAL. You might get a marginally better snack or a marginally smilier agent on one vs. the other, but how much are you willing to pay for that when you can bring your own food on board?

    To decomoditize the industry, a player would have to offer a significantly differentiated product. You wouldn’t tell me that a “steak” is a commodity item. No one would confuse a steak from Denny’s with a steak from Morton’s. But once you’re crammed inside a tin can like sardines, could you really tell me what airline you are on without looking a the rude flight attendant’s name tag?

  • Mary

    Great article! I couldn’t agree more. The Middle East is a fascinating region and I would love to be able to visit it someday without being afraid for my safety.

    That being said, I think the reality of higher oil prices is that it could make the divide between rich and poor that much more pronounced. For example, a wealthy person can afford to run a gas-guzzling SUV and heat a huge home despite the price. But what about the person with a small house and a sedan?

    Everyone should have to cut back. Not just those who can afford to.

  • Dennis Jones

    I see $100 barrel oil just costing me more to fly. It will not improve service, amenities, or anything else. It will only cost more and impede my travel decisions as to destinations.

  • jlawrence01

    It is amazing how many of the “travel elite” want to return to a day when only a small portion of the population can afford to travel.

    TRIPSO spends so much time complaining about the legacy airlines … but uses opportunity to criticize those airlines like Southwest that provide excellent (yet defeatured service).

  • Dave

    I have to agree with jlawrence01 – what is great about pricing lots of people out of the market for travel? I guess it would make it easier for the wealthy, who would have fewer of us to deal with in the airports. This column is usually interesting, but I’m afraid you’re really, really reaching here for a contrarian point of view.

  • Natasha

    Lenny – not sure i agree on the whole corn thing. Food is in a completely different category than flying. I’d choose my local corn over some corn that has been flown half way across the world to get to me any day… freshness… safer…etc. I know where it came from..it helps my local community. In fact, i never eat corn out of season, if that tells you anything at all. It might be different in other parts of the country… but Long Island has a great sense of pride in eating local.

    But – in opposition to the writer’s #5 – when it comes to flying… price is always a factor knowing its just a trip and my destination is what counts in the end. I dont think people are going to choose airlines based on service – atleast not the bulk of the travelers out there. I think airlines will use service in the end to hook customer… adding to their already “lower” prices. Too bad for them… good for us!

    That being said… airlines need to find a better way to connect to communities and their clients… like… for example.. Southwest… who has allowed their flight attendants to use humor to connect with their clients. Hire funny, intelligent, whitty people… people who will connect with clients on a personal level. Its ingeneous really! A no-brainer!

  • Jasper

    @jlawrence01 & Dave:

    It’s not about pricing poor people out of flying. It’s about making sure that your children can still enjoy the outside air without getting instantaneous asthma. It’s about cleaning up the mess you make, and not leaving that mess for your children. It’s about living responsibly.

    America is a beautiful and relatively empty country. Not a lot of people live here. That’s why the effects of pollution are not that obvious. However, in Europa, India and China people live closer to each other, and notice more that smog develops. And that is stinks, and makes them cough.

    Going green means ending that. Going green means that we make sure that we clean up the mess we create during our lives. It morally right.

    Going green does not mean that industries will collapse. Going green also does not mean that nobody can travel anymore. Going green just means cleaning up the crap that industry makes, and the dirt that comes out of cars, planes and other forms of transportation.

    Does that cost money? Yes. But just like it cost effort to clean your room when you were a little kid, boy are you happy now, your parents taught you some discipline when you were young, so now you are a reasonable person who can live independently. The same needs to happen with the mess we make while living.

    Apologies to C.E. for polluting your blog with my green rant.

  • lynn

    Natasha,

    The corn as a commodity does hold up. I think that you are thinking of that summer tim pleasure of corn on the cob. The comment was referring to corn by the bushel that is used for food but is also an ingredient in a wide range of industrial products, notable to the travel industry…ethanol. This coren is typically bought by the train car load rather than by the ear.

    I disagree with the idea that simply making the cost of travel more expensive will act to make travel less of a commodity. In the years since deregulation, the airlines have fallen all over themselves in their efforts to make air travel as much like the ‘bus’ as possible. What ever perk or ammenity that airline A eliminated was also eliminated by airlines B thru F. Add to this the efforts of the TSA to protect us from sippy cups and other threats and we have a large percentage of the population that only flies when or because they have to. It wasn’t always like this.

    While ‘fixed income’ is usually associated with people that are retired, in reality nearly all of us are on a fixed income. Very few people have the opportunity or time to make a few hundred bucks this month. Neither do I have a viable option to get to work other than drive. Every dollar that goes into the tank will have to come out of my pocket and leisure travel will be one of the first extras sacrificed.

  • Joshua Katt

    I don’t think anyone intentionally wastes fuel anymore, I stopped “cruising” in my car as a 16 year old when gas went from .65 to $1.30 overnight.

    Energy is not optional commodity like corn or orange juice. If those commodities skyrocket or become unavailable, I could substitute, live, survive and go to work, earn a living and pay taxes that keeps America humming.

    I can’t substitute anything to heat my house and make my car go. It time for our gov’t to take the greedy profit motive out of energy. But I dream…

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