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Oil price drop not affecting domestic airfares, so shop smart for best deals
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Oil prices are down. So are airline fuel costs. Passenger demand is expected to increase in the coming months. - photo by Jeff Wuorio
Oil prices are down. So are airline fuel costs. Passenger demand is expected to increase in the coming months.

A formula for super cheap airfares? Hold the happiness.

Although the price of oil dropped to roughly $46 a barrel in late January a five-year low those lower costs havent made their way to the price of a stateside plane ticket.

Grim, said Pauline Frommer, editorial director of the travel planning website, when asked to describe the outlook for domestic airfares in 2015.

Still, there are some bright spots for travelers in the coming months, particularly those traveling overseas. And, regardless of what the airlines decide to do with seat prices, it still pays for consumers to know their stuff when trying to sniff out the best ticket deals possible.

An 'oligarchy'

On the surface, dropping fuel prices which account for 30 to 50 percent of an airlines operating expenses should naturally transfer to lower consumer ticket costs. That seems to be the case on a global level.

In its latest industry economic outlook released in December, the International Air Transport Association, the regulating body for international air travel, forecast that global airfares would decline some 5 percent in 2015.

This is primarily attributable to declining fuel prices, said spokesperson Perry Flint.

Projections also hold that passenger loads will likely go up over the next several months. Moodys Investor Service reported in early January that passenger demand would increase in 2015 due to improving economic conditions boosting consumers' disposable income.

Unfortunately, all that positive news hasnt translated to drops for travelers who want to fly within the United States. While fuel costs are down for airlines, say experts, the consolidation of the domestic air market has resulted in little movement in airfares.

There are many reasons ticket prices havent come down, said Christopher Elliott, author of How to Be the Worlds Smartest Traveler. But when you have ... four airlines controlling 85 percent of the routes and in certain markets, just one airline theres no incentive to lower prices. Its an oligarchy.

The airlines take on this is ... after many years of losses, theyre finally making a profit which they can reinvest in better infrastructure, better planes and better terminals.

But, if fuel costs continue their downward slide, it could put "continued downward pressure on fares (and) it may be a decent summer for (domestic) airfares, he said.

It's already turning out that way for international travel. For one thing, said Frommer, the dollar is walloping most other foreign currencies, making international air travel a relative bargain.

Weve seen international fares start to drop a bit since fewer people from foreign countries are coming to the United States, she said. Its the strength of the dollar overseas thats really the light at the end of the tunnel. That, and international airlines are much more diverse and open to competition.

A case in point is Dubai-based Emirates in late January was advertising round trip tickets for two from New York to Milan, Italy, for $799 for coach class.

Shop smart

No matter what airlines decide to do with regard to ticket fares, knowing a few proven strategies and doing the necessary legwork are still necessary for landing cheap airfares.

To that effect:

Know the optimal day to book your flight. According to a study by the Airline Reporting Corp., a travel data and statistics concern, domestic ticket prices were, on average, $110 cheaper on Sunday as opposed the rest of the week. The disparity was even larger $462 for international travel.

Know how far in advance to make your reservations. Again, according to the ARC, timing is everything. Research shows that the best domestic ticket fares are to be had 57 days prior to departure roughly eight weeks. For international travel, lay your money down 171 days before actual travel, or about 24 weeks in advance.

Check out flights that everyone else hates, such as red-eye flights. Elliott said flights that happen at inconvenient times can offer ticket bargains.

Investigate flying into alternate airports. Many large metro airports particularly carrier hubs often command the most expensive ticket prices for travelers. By contrast, smaller, nearby airports with lower traffic levels may be less expensive.

Leverage technology. Most savvy travelers use websites that compare airfares and other related travel expenses. Dont overlook mobile apps such as Fare Compares When-To-Fly iPhone app, which offers real-time notifications when fares of interest change in price.

Be flexible. Although the rule of thumb for affordable fares is to book well in advance, airlines are understandably peeved when flights are severely underbooked. To make the best of a bad situation, they often offer cut-rate fares at the last minute just to try to fill up the plane. Signing up for alerts from the airlines can let you know when you can take advantage of these deals.

Keep an eye on social media. Many airlines use Facebook, Twitter and other social media to announce deals on fares. But, be fast and flexible as many such offers may only last for a few hours.

Check out the airlines websites. That may seem like an overly obvious idea, but some airlines only post deals and specials on their websites.

Keep fares in perspective. If you find a reasonable fare, nab it and put your energy elsewhere.

People who spend hour after hour to save a couple of dollars are forgetting the value of their time, said Elliott. Instead, spend that time planning how youre going to have a great time with your family or researching a great restaurant.
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