When Will Oil Prices Impact The Lodging Industry?ATLANTA,, GA, June 7, 2011 – Based on a recent analysis conducted by PKF Hospitality Research (PKF-HR), the U.S. lodging industry will see minimal disruption if oil prices reach $125 per barrel price in 2011.
However, if prices surge to $150 a barrel, the recovery that U.S. hotels are currently enjoying could be severely curtailed.
The results of the analysis have been published in a special report entitled Oil Prices and Lodging Risk. John B. (Jack) Corgel (top right photo), the Robert C. Baker Professor of Real Estate at the Cornell University School of Hotel Administration and senior advisor to PKF-HR, and Jamie Lane, Research Associate, are the authors of the report.
“As the price of oil has shot up, and then down, over the past few months, many U.S. hoteliers have worried about the impact that oil prices could have on their business,” said R. Mark Woodworth (middle left photo), president of PKF-HR. ”Our analysis found that when oil prices increase beyond normal levels, individual consumer and business spending power is reduced, which in turn has a negative multiplier effect throughout the economy in general and the lodging industry specifically.
“Based on our study, oil prices above $125 a barrel exceed ‘normal’ levels and would have an increasingly negative effect on hotel operating performance.”
The PKF-HR Hotel Horizons® econometric forecasting model relies on economic data from Moody’s Analytics (Moody’s) to project future hotel demand levels.
In April of 2011 Moody’s Analytics created two “oil spike” economic forecasts around a hypothetical future where prices increase to either a high of $125 or $150 a barrel by the fourth quarter 2011. PKF-HR used these hypothetical economic scenarios to forecast RevPAR for the U.S. lodging industry through 2013.
In April of 2011 Moody’s Analytics created two “oil spike” economic forecasts around a hypothetical future where prices increase to either a high of $125 or $150 a barrel by the fourth quarter 2011. PKF-HR used these hypothetical economic scenarios to forecast RevPAR for the U.S. lodging industry through 2013.
For comparison purposes, the March 2011 Hotel Horizons® forecast served as the baseline lodging forecast for the analysis. This baseline forecast reflects Moody’s modeled fundamental price of oil ($93.53) coupled with a premium of around $5.00 to account for the supply uncertainty created by ongoing unrest in the Middle East.
To download a complimentary copy of the Oil Prices and Lodging Risk report, please visit www.pkfc.com/oilpricesandlodgingrisk
.
For further information, please contact:
Mark Woodworth, President, PKF Hospitality Research, Tel: 404 842 1150, ext 222 Email: mark.woodworth@pkfc.com
Chris Daly, Daly Gray Public Relations, Tel: 703 435 6293,
Email: chris@dalygray.com
No comments:
Post a Comment