Analysis of several travel markets by travel booking site Expedia finds that airfares should drop this year.
The breakdown of data from a number of sources concludes that prices in Europe and the United States should drop as more capacity is added and airlines pass on cost savings from lower fuel prices. Ticket prices in the Asia-Pacific region are predicted to remain flat or could increase slightly.
The booking website's Air Travel Trends paper uses information from the Airlines Reporting Corporation (ARC), the International Air Transport Association, Diio Mi and the Airline Tariff Publishing Company.
The paper includes insights into when is best to buy the cheapest tickets. For traffic originating in the United States, the earlier tickets are purchased, the cheaper they are.
"This has been true for decades, and it's still true today. What's really happening behind the scenes is that airlines' revenue-management systems generally increase ticket prices as the departure date nears."
According to ARC data, the lowest ticket prices on most domestic tickets have been seen between 50 and 100 days before departure.
In the United States at least, the lowest average ticket price can be found 57 days in advance.
The same data indicates that for low fares on international travel, travellers should consider booking even earlier, with the lowest price out of the US found 171 days before travel.
Sales begin to accelerate around 100 days in advance of departure for domestic flights and 200 days in advance for international services.
A recent study by Expedia of air-ticket price data indicates that for travel booked more than three weeks in advance of departure date, Tuesday still appears, by the slimmest of margins, to be the best day of the week to buy.
"It's worth noting that because airfares change minute by minute and day by day, anointing one particular day of the week is not necessarily the best predictor of a good-deal fare", the report said.
Research by George Hobica, founder of Airfarewatchdog.com, found the trick to finding low airfares is to search several times a day.
Expedia has also found the difference in ticket prices for seats in premium and economy cabins is shrinking.
"We're not going to lie. Premium-cabin seats are expensive. Premium ticket prices on long-haul routes hover around three-and-a-half times the economy ticket price on the same routes. At the same time, the gap between premium cabin and economy airfares on short-haul routes has been shrinking significantly over the last two years - the trend has been observed consistently across North America, Europe, and Asia Pacific," the report said.
New Zealand travel agents say the impact of lower fuel prices will be felt here.
Flight Centre NZ's general manager of product Simon McKearney said the impact may not be immediate.
"The talk of fuel is topical when you put one and one together and try to make two. But when you think of the hedging and some of the policies, that those airlines are pretty heavily hedged. You're not going to see immediate reductions."
House of Travel commercial director Brent Thomas said there were signs of a round of fare cutting on the Tasman - the most competitive market - with Jetstar offering fares as low as $139 one-way.
Airlines confident about better profits
Airlines are bullish about profits this year, according to a survey of chief financial officers and heads of cargo during the past month.
The International Air Transport Association survey finds that falling costs and growth in volumes are responsible for better recent financial performance as well as the positive outlook.
The decline in costs in the last quarter of last year was the result of the fall in crude oil prices feeding into lower jet fuel prices.
"Moreover, survey respondents expect the trend to continue during the year ahead, with an outlook for further declines in input costs. Prior surveys' responses included reference to cost-cutting measures as reasons for declines in current/future cost expectations, but the recent decline in fuel prices has pushed future cost expectations down further," the survey said. Just on 78 per cent of chief financial officers say profitability should improve during the next 12 monthsand 70 per cent were expecting a rise in passenger traffic volumes during the next year.
The survey follows the release of Iata figures which show worldwide airline share prices rose 4 per cent in December and are up 40 per cent for the year, helped by the fall in jet fuel prices.
• While it's impossible to guarantee when travellers can find the lowest fares, from the United States buying at least two months in advance for domestic travel and six months in advance for international travel puts you in the best position to get a good deal.
• Tuesday appears to remain the best day of the week to find low fares on air travel booked at least three weeks in advance. (Flight Centre here says the day of the week is not so important but heaviest booking is around the days that airline specials end and these can vary.)
• The gap in price between premium and economy-cabin tickets is shrinking, and, generally speaking, premium-cabin air tickets are not as expensive as many travellers assume. On some routes, prices on these tickets actually make them good value, considering the perks.
• Overall, increased demand in 2015 is being met with increased capacity in such a way that they cancel each other out. Couple that with a drop in fuel prices, though, and consumers should see slightly lower air-ticket prices to most North American and European destinations in 2015.