Florida's motor boating industry struggles to stay afloat amid soaring fuel prices

The recreational boating industry in the United States is struggling to stay afloat as it feels the pinch of soaring fuel costs, with the uncertainty surrounding the Middle East conflict continuing to drive up oil prices.

Surging global energy costs has been one of the main spillover effects of the U.S.-Israeli war on Iran, which has caused major disruption to shipping along the Strait of Hormuz -- a vital shipping passageway for oil and gas supplies.

The impact on this key waterway is being felt thousands of kilometers away on a different body of water, with boat captains in Florida Keys, a popular scuba diving, fishing, and boating destination off the coast of Florida, being forced to reconsider their livelihoods amid the current slump.

Dillon McGovern, a captain who runs scuba diving trips out of Key Largo, says marine diesel now costs nearly two dollars more per gallon than just a few months ago, with prices even higher on the water.

"This is a 40-foot boat, so it never leaves the water. So we get a fuel truck in, and fuel costs -- I think diesel right now is like 5.25 dollars a gallon. On water, it's a little over 7 dollars a gallon," McGovern said.

"Anything on the water is more expensive. When you say marine, it doubles in cost. An alternator on land for a car, 200 bucks. An alternator in this boat, 600 dollars," he added.

Each trip burns at least 17 gallons or about 170 U.S. dollars in fuel before the boat even leaves the dock.

Divers still pay the same rate as always, leaving the boat owner to absorb the difference, but higher costs means less money is leftover for the crew, according to McGovern.

"The quality of service doesn't go down, but the tips go down, because [the rising prices are] eating into [people's budgets and they hope] the costs (can) come down here. So they've got a little less jingle in their pocket. That little less jingle passes on to us too," he said.

For some boat operators, the current financial stress has already forced them to reshape their working lives.

Jonathan Lorenzo, who has been in the industry for nearly eight years, used to just run his own boat, but with money tight, he is now captaining boats for other owners and resorting to other means such as selling cars to make up the lost income.

"It's definitely hard to make sense of it in some cases. My other boat was a twin motor 31-foot center console. That boat on an average trip would spend 40 to 60 gallons. So instead of spending 250-300 dollars to fill that up, now you're spending 600, 500, 700 dollars, which definitely makes a big difference," Lorenzo said.

"[The] captaining and boats [sector] kind of slowed down a lot between just people busy with lives and costs going up and just having to take care of their businesses with my private clients. And just the car industry is something where in South Florida it's a must-have. We don't have public transportation, so that's why I got into that," he said.

Florida's motor boating industry struggles to stay afloat amid soaring fuel prices

Amid the rising fuel costs and airline surcharges linked to the U.S.-Israeli war against Iran, Caribbean tourism officials gathered at the 44th Caribbean Hotel and Tourism Association Forum this month and expressed cautious optimism, citing resilient visitor demand, strategic marketing adjustments, and strong seasonal performance as foundations for continued recovery.

The U.S.-Israeli war against Iran is already affecting Caribbean economies as fuel prices surge and airlines pass costs on to passengers. This not only pressures the region's tourism-dependent economies but also raises the cost of imported food, electricity, and transportation.

Since the start of the conflict, the price of Brent crude has surged nearly 50 percent, prompting airlines to find the ways to share the burden with travelers.

"The impacts are unfolding in stages. In the first place, when the uncertainty, or the disturbance occurred in the Middle Eastern region, it actually cut the supply chain to some extent to the Pacific, and people started to look at the region in particular. We amplified out marketing presence, to ensure that when people are looking for an option or places to rebook, that St. Lucia would turn up. And we've actually seen some of that result," said Louis Lewis, chief executive officer of the Saint Lucia Tourism Authority.

During the International Monetary Fund's Spring Meeting, the international financial institution expressed its concern for Caribbean tourism, warning that it could see a decline as ticket prices increase.

Lewis acknowledged the potential for longer-term disruption.

"The second thing is that if the conflict continues as a prolonged activity, we anticipate that it could impact us. We will have to diversify from our major source markets, hence the reason why we are looking at Latin America," he said.

But some of the region's top tourism officials are seeing positive signs. The region is coming off another successful year, where tourism arrivals grew by 2.5 percent, adding an additional 900,000 visitors over 2024.

"The region has been witnessing a very good winter season, and I have no doubt whatsoever that the forecast that we have for the summer will continue to be very strong," said Ian Gooding-Edghill, minister of tourism of Barbados.

Still, structural vulnerabilities remain. As an import-dependent region, the Caribbean is highly exposed to global price fluctuations. Concerns are mounting that rising prices in the United States could trigger sharper inflationary pressures, including higher operating costs in the tourism sector.

"In Saint Lucia, we just saw the cost of energy increase about 20 percent, and that's having an impact now going into the summer when our rates are lower. It rallies points to the importance of us building a bit more resilience into Caribbean tourism," said Sanovnik Destang, president of the Caribbean Hotel and Tourism Association.

Caribbean tourism shows resilience despite Middle East tension challenges