Agencies aren’t letting higher costs keep their employees from traveling, at least for now.

Travel costs are increasing rapidly. Oil at $100-plus a barrel has driven up airfares; airlines have already hiked prices seven times this year. According to Sabre Travel Networks, business- and first-class fares have increased by more than 12 percent in the last year; economy fares have risen about 6 percent.

Hotel and rental car prices have increased, too. And travelers who stick to the highways are pinched by gas prices well beyond $3 per gallon in most parts of the country.

Businesses have responded by cutting back on travel, but federal agencies have yet to follow suit.

That’s because, so far, they haven’t needed to. Federal travel managers haven’t faced as many challenges as their private-sector counterparts. The General Services Administration helps insulate federal travelers from those higher airfares with its CityPairs program. Under CityPairs, GSA negotiates contracts with airlines a year in advance, and locks in below-market fares for hundreds of routes.

The agency did start levying fuel surcharges on some of those CityPairs routes in November. Most are modest: Flights from Washington to many European destinations, for example, carry a $30 surcharge. A business traveler paying commercial fares on the same route would pay up to $115 in fuel surcharges.

While hotel costs were up 6 percent last year, the FedRooms program keeps hotel costs down for federal travelers.

“Before, the hotels didn’t need government business,” said Tracy Shook, director of FedRooms. “But now, corporate business is soft. And government is usually the last sector to pull back on travel.”

Bookings at FedRooms have increased by half this year, compared with 2007. Shook attributes some of that to better marketing of the program, but she said FedRooms’ fares are increasingly attractive compared with rising commercial rates.

And while rental cars are 20 percent more expensive than a year ago, GSA’s negotiated rates are below market prices. In some major markets, like New York, the government rate is less than half the commercial rate.

Those low prices have enabled federal agencies to keep traveling, even as the private sector scales back on business travel, but officials at several agencies say that could change later in the fiscal year.

The Defense Department’s travel spending, more than $10 billion last year, is the government’s highest — higher than the combined total of every other agency. According to Cheryl Irwin, a spokeswoman for the department, Defense has no plans to scale back on travel budgets.

Instead, individual managers are responsible for their travel spending.

“There’s no departmentwide policy on travel. It’s just common sense,” said another Defense employee knowledgeable about the department’s budget. “Commanders plan their travel budget for the year, and they have to stick to it.”

At the Homeland Security Department, the largest civilian spender, managers haven’t asked employees to cut back on travel either. But Larry Orluskie, the department’s spokesman for management, said it’s hard to gauge the impact of higher travel costs until later in the fiscal year.

“Managers have a budget to live by,” Orluskie said. “And … say in the third quarter they’re not where they need to be, then they’re going to have to adjust and cut back.”

That attitude was echoed by other agencies contacted by Federal Times: Departments are not setting broad travel policies. But managers who don’t plan their budgets around higher travel costs might find themselves squeezed later in the year.

“DOJ components are expected to live within their appropriations,” said Erik Ablin, a spokesman for the Justice Department, who acknowledged that higher travel costs could affect the department. “The individual component heads [would have to] make internal management decisions … on how best to respond.”

The department is promoting videoconferencing as a way to reduce travel costs, Ablin said, but only in certain circumstances. None of the other agencies contacted said they are promoting alternatives to travel.

But oil prices are expected to stay high. And with GSA’s airfare and rental car contracts up for renegotiation later this year, there is the possibility that next year’s travel costs will be higher. Viki Reath, a spokeswoman for GSA, couldn’t comment on the contracts because they’re under negotiation.

There is good news for travel managers, though: While airfares are expected to keep increasing, hotel costs might start to decrease.

“I don’t think they can keep going up. I think they’ll actually go down,” Shook said. “There isn’t enough demand to justify higher hotel prices right now.”