Why fall in oil prices will not fetch you cheap air tickets?

In the countries where the fuel is deregulated from the control of the government and its price is left to the market forces to decide, there is a fluctuation in the prices of the flight tickets. When there is an increase in the prices of the aviation fuel (ATF), the costs of tickets are increased and when there is a decrease, a fall in the prices is expected? But, does it actually happen? Or, does it happen quickly enough? There have been situations where, even after the deregulation and decontrol of the prices of the fuels, notably the ATF, and reduction of the prices, the prices of the tickets has not come down.

The airlines have their own reasons which seemingly look justified but, at the same time, raise questions over their motives in not reducing the prices of the tickets. It is quite a common knowledge that once the airlines get the chance to increase the prices, ostensibly on the increasing costs of the fuel prices, the reduction is not done to the same extent and on time. The most common reasons given by the airlines is that since there is some time elapse between the actual rates going up and this increase figuring in the prices of the cheap air tickets, there is a loss to bear for the airline and this is sought to be made good when the prices of the ATF decline but the higher prices of the flight tickets are not reduced immediately. Further, the people who have already booked the flights during these price changes cannot be asked to pay more or less depending on the rise or fall of the ATF respectively.

In between these seemingly logical reasons for not reducing the prices of the tickets immediately, the airlines can play their hand at maximizing the revenues and profits by keeping the prices high for an extended time frame.

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