SINGAPORE: The impact of rising fuel prices linked to the ongoing conflict in the Middle East is rippling through the travel industry, affecting ferry operators, cross-border bus services and travel agencies in Singapore.
Operators told CNA they are adjusting schedules, consolidating trips and absorbing higher costs where possible.
They warned that the coming weeks will be critical for the travel sector, with the March school holidays underway this week and the Hari Raya festive period approaching at the end of the week.
Some expect additional airline and cruise fuel surcharges if energy prices continue to rise, potentially adding further pressure on travel demand in the months ahead.
Those looking to take trips to neighbouring islands will soon find themselves with fewer choices, with some ferry operators cutting services by up to 40 per cent to manage rising fuel costs.
From last Thursday (Mar 12) onwards, several operators that offer services between Singapore and Batam have imposed a S$6 (US$4.70) fuel surcharge.
One of them, Batam Fast, said fuel costs have tripled since the conflict began on Feb 28, when the United States and Israel attacked Iran.
This forced the company to cancel about two trips per day over the past week when passenger numbers were too low.
It has been working with fellow operator Sindo Ferry to fill as many seats as possible on each trip to less-frequented parts of Batam such as Gold Coast. This also provides passengers with more schedule options from both operators.
If the passenger load on a certain trip is low, Batam Fast will ask travellers if they are willing to go on the next trip instead, said the firm’s general manager of ferry operations Chua Choon Leng.
“That’s the best scenario that we can have. If you think that your timing is very critical because you have activities in Batam, then we will transfer you to our interlining partner's trip,” he added.
Other maritime operators are also feeling the strain.
YachtCruiseSG, which runs speedboat tours around Singapore’s Southern Islands, said it now costs about S$800 to refuel a vessel – up roughly 45 per cent from around S$550 before the conflict.
Instead of raising prices, the company has reduced the number of daily trips.
"Instead of five full slots, we're going to cut down to three so that we minimise the usage of petrol. We are not going to make any money, but we also don't lose money,” said YachtCruiseSG director Kogu Segaran.
Another operator, Marina South Ferries, plans to introduce fare increases of 20 to 30 per cent in phases over the coming weeks. Some of its private charter trips have already seen fares rise by 30 per cent.
Similarly, rising fuel costs are also affecting cross-border bus services between Singapore and Malaysia.
Operators said they may begin consolidating bus trips after the Hari Raya period, such as reducing departure timings and optimising routes to keep ticket prices stable.
One firm, Cityline Global, told CNA that diesel costs have increased by around 30 per cent since the conflict began.
Its drivers have also reported to management that some petrol stations in Malaysia are restricting diesel purchases to 20 litres per vehicle, down from about 150 litres previously.
To cope, Cityline has reduced its passenger boarding points from six to four and is exploring cooperation with competitors to maximise capacity.
"For example, if I have 10 passengers (and) they have 10 passengers, we could probably (get them) together and travel by the same bus. But the offerings might be slightly different,” said Cityline business manager Kevin Tay.
“Even though we are competitors, there are also ways to help each other reduce costs.”
Revenue has already fallen by at least 20 per cent year-on-year since the start of the conflict, partly because travellers from the Middle East are no longer able to visit due to airspace closures, added Mr Tay.
He added that the longer routes, such as those between Singapore to Kuala Lumpur, are more affected as compared to those to Malacca or Johor Bahru, given the greater distance and wider range of travel options.
Operators Golden Coach Express and Delima Singapore, said it is also monitoring the situation closely.
Ticket prices for both firms will not be changed for now as its fuel cost is subsidised by the Malaysian government, said their owner Leong Ying Ken.
Meanwhile, some travel agencies are facing mounting losses as tour groups cancel or postpone trips to Europe.
Fewer flights are going through the Middle East to Europe due to airspace closures, with the uncertainty leaving some travellers reluctant to shift their bookings to a later date in April.
This has left agencies to bear the cost, with one – Super Travels – expecting to pay about S$270,000 in cancellation costs.
Around 90 of the agency’s customers postponed European trips during the March school holidays.
"We are trying to see if we can just ask for a refund of the tickets – so that's what we are looking at to mitigate some loss, at least from the airline side,” said the agency’s vice president William Huang.
Checks by CNA show that one-way flights in May to Amsterdam through Shanghai or India, for example, cost more than double compared to flights in February.
As a result, many travellers are choosing destinations closer to home, such as China and Taiwan – but this has pushed up airfares to these places as well.
EU Holidays said flights to China are now 20 per cent more expensive compared to the same time last year, due to rising fuel prices and the sudden boost in travel demand.
"Since we already see an increase in tours going to Asia or China, we are trying to offer passengers a lot (of) other destinations,” said the company’s director Ong Hanjie.
“We try to come up with more experiential itineraries in, let's say, Taiwan, to allow guests to have a different experience compared to the generic itineraries that are evergreen on the counter.”
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Operators told CNA they are adjusting schedules, consolidating trips and absorbing higher costs where possible.
They warned that the coming weeks will be critical for the travel sector, with the March school holidays underway this week and the Hari Raya festive period approaching at the end of the week.
Some expect additional airline and cruise fuel surcharges if energy prices continue to rise, potentially adding further pressure on travel demand in the months ahead.
FEWER FERRY TRIPS
Those looking to take trips to neighbouring islands will soon find themselves with fewer choices, with some ferry operators cutting services by up to 40 per cent to manage rising fuel costs.
From last Thursday (Mar 12) onwards, several operators that offer services between Singapore and Batam have imposed a S$6 (US$4.70) fuel surcharge.
One of them, Batam Fast, said fuel costs have tripled since the conflict began on Feb 28, when the United States and Israel attacked Iran.
This forced the company to cancel about two trips per day over the past week when passenger numbers were too low.
It has been working with fellow operator Sindo Ferry to fill as many seats as possible on each trip to less-frequented parts of Batam such as Gold Coast. This also provides passengers with more schedule options from both operators.
If the passenger load on a certain trip is low, Batam Fast will ask travellers if they are willing to go on the next trip instead, said the firm’s general manager of ferry operations Chua Choon Leng.
“That’s the best scenario that we can have. If you think that your timing is very critical because you have activities in Batam, then we will transfer you to our interlining partner's trip,” he added.
Other maritime operators are also feeling the strain.
YachtCruiseSG, which runs speedboat tours around Singapore’s Southern Islands, said it now costs about S$800 to refuel a vessel – up roughly 45 per cent from around S$550 before the conflict.
Instead of raising prices, the company has reduced the number of daily trips.
"Instead of five full slots, we're going to cut down to three so that we minimise the usage of petrol. We are not going to make any money, but we also don't lose money,” said YachtCruiseSG director Kogu Segaran.
Another operator, Marina South Ferries, plans to introduce fare increases of 20 to 30 per cent in phases over the coming weeks. Some of its private charter trips have already seen fares rise by 30 per cent.
CONSOLIDATING CROSS-BORDER TRIPS
Similarly, rising fuel costs are also affecting cross-border bus services between Singapore and Malaysia.
Operators said they may begin consolidating bus trips after the Hari Raya period, such as reducing departure timings and optimising routes to keep ticket prices stable.
One firm, Cityline Global, told CNA that diesel costs have increased by around 30 per cent since the conflict began.
Its drivers have also reported to management that some petrol stations in Malaysia are restricting diesel purchases to 20 litres per vehicle, down from about 150 litres previously.
To cope, Cityline has reduced its passenger boarding points from six to four and is exploring cooperation with competitors to maximise capacity.
"For example, if I have 10 passengers (and) they have 10 passengers, we could probably (get them) together and travel by the same bus. But the offerings might be slightly different,” said Cityline business manager Kevin Tay.
“Even though we are competitors, there are also ways to help each other reduce costs.”
Revenue has already fallen by at least 20 per cent year-on-year since the start of the conflict, partly because travellers from the Middle East are no longer able to visit due to airspace closures, added Mr Tay.
He added that the longer routes, such as those between Singapore to Kuala Lumpur, are more affected as compared to those to Malacca or Johor Bahru, given the greater distance and wider range of travel options.
Operators Golden Coach Express and Delima Singapore, said it is also monitoring the situation closely.
Ticket prices for both firms will not be changed for now as its fuel cost is subsidised by the Malaysian government, said their owner Leong Ying Ken.
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LOSSES FOR TRAVEL AGENCIES
Meanwhile, some travel agencies are facing mounting losses as tour groups cancel or postpone trips to Europe.
Fewer flights are going through the Middle East to Europe due to airspace closures, with the uncertainty leaving some travellers reluctant to shift their bookings to a later date in April.
This has left agencies to bear the cost, with one – Super Travels – expecting to pay about S$270,000 in cancellation costs.
Around 90 of the agency’s customers postponed European trips during the March school holidays.
"We are trying to see if we can just ask for a refund of the tickets – so that's what we are looking at to mitigate some loss, at least from the airline side,” said the agency’s vice president William Huang.
Checks by CNA show that one-way flights in May to Amsterdam through Shanghai or India, for example, cost more than double compared to flights in February.
As a result, many travellers are choosing destinations closer to home, such as China and Taiwan – but this has pushed up airfares to these places as well.
EU Holidays said flights to China are now 20 per cent more expensive compared to the same time last year, due to rising fuel prices and the sudden boost in travel demand.
"Since we already see an increase in tours going to Asia or China, we are trying to offer passengers a lot (of) other destinations,” said the company’s director Ong Hanjie.
“We try to come up with more experiential itineraries in, let's say, Taiwan, to allow guests to have a different experience compared to the generic itineraries that are evergreen on the counter.”
Continue reading...