01/03/2009 05:12 am ET | Updated May 25, 2011

Airline Fuel Surcharge Rip-Off... No Refunds

The price of jet fuel has dropped dramatically in the last few months and many airlines have abolished the fuel surcharges that they imposed earlier this year.

But are they refunding customers who paid this surcharge for tickets well in advance?

Nah...of course not.

Chris Elliott, a travel ombudsman (read his travel blog here), explains that this is not simply an academic question.

Take Elliott's example: traveler Simon Gornick bought a ticket on Virgin Atlantic in October from Los Angeles to London for Christmas that included a hefty $400 fuel surcharge. A few days after Gornick made his reservation, Virgin Atlantic cut its fees (the spot price of a gallon of New York Harbor kerosene jet fuel dropped from $3.92 per gallon in June to $2.43 in October, according to the U.S. government's Energy Information Administration.)

Gornick phoned Virgin a few weeks later to check the price on the same flight, and found that the $400 surcharge was gone for new customers, but not for him.

He then contacted Virgin's customer relations department by email to ask if he could get a refund for his ticket purchased in October when the fuel surcharge was in effect, but heard nothing back.

Elliot phoned Virgin Atlantic himself and repeated Gornick's request for a refund.

"Unfortunately not," he was told.

That means that many people are paying the surcharge on the same flight, while others are not.

This is nutty and dishonest.

In a nifty bit of guerilla marketing, Europe's Ryanair called on rival Aer Lingus to scap its unfair and unjustified fuel surcharges. Ryan air, Europe' largest low fare airline, said passengers are deserting high fare, high fuel surcharging airlines like Aer Lingus in favour of Ryanair. Aer Lingus is charging a surcharge of $130 each way even though oil prices have fallen by almost 70%.

Virgin, and the other airlines, should be more transparent in their fees. If they charge a fuel surcharge, then that's what it should be... and when the price of jet fuel drops they should eliminate it and refund passengers who paid when the price of oil was high.

If airlines need to raise their fees because of market conditions, so be it, but they should stop nickel-and-diming their passengers with disingenuous fees, that aren't really for what they are supposed to be.

When Airlines lower their fuel surcharges, they should offer a refund -- or at least credit -- to passengers who paid the fee earlier -- simply as a gesture of thanks and goodwill.

In these difficult days the airlines need all the positive public relations they can get. Cruise lines are pulling the same stuff with fuel surcharges and other fees, and they too should be more appreciative of their customers who are booking in these tough times.

Putting aside the clear deceptive price gouging by the airlines -- represented by the use of the surcharge -- it strikes me as grossly unfair for fliers to be penalized for an airline's poor oil future purchases.

Better yet, as a sound long term business practice, the airlines should eliminate fuel surcharges altogether and include the price of fuel in the fare, argues Elliott. After all if any business should be well informed about oil prices, it should be the airline industry. And given the volatility in that market, they should have been more vigilant about the spot price.