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The Economics of Frequent-Flier Surcharges

Call it the frequent flier arbitrage: rack up lots of miles when oil prices are low and flights are cheap. Wait a year or so for oil prices to skyrocket and fares to rise. Then cash in your miles, receiving in return a much higher dollar value than anybody anticipated when you earned them.

I'm not sure that anybody forced to fly in today's unhelpful skies can be considered a winner here, but there's no doubt who the losers are: the beleaguered airlines. So it makes perfect sense to me that Delta and others are slapping fuel surcharges on awards flights.

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