While oil consumers' pain is the oil producers' gain, the relationship is providing some benefit in the other direction, at least for one airline.
Discussing corporate travel trends yesterday with analysts, Continental Airlines president Jeff Smisek said some of the oil and gas companies located in the carrier's hometown of Houston "are living large and flying all around the world up front and spending money like drunken sailors."
That is in stark contrast to firms in other sectors, particularly financial institutions, Smisek said, that are "under pretty tight screws on some of their travel," which has prompted more bookings further in advance, fewer premium class tickets and a "higher level internal approvals."
But on balance, Smisek said, "most companies are not significantly reducing their air travel budgets. ... And while it’s good news that we aren’t hearing of travel budget decreases for the most part, we also aren’t hearing of many companies increasing their travel budgets to compensate for higher fares. So the number of trips taken will have to decrease if companies are to stay within their travel budget."
Think of how that balance would be different if the oil companies--posting tremendous profits as the airline industry struggles to stay afloat--weren't also among Continental's most lucrative customers.