Cut and run to the sun

The credit crunch has hit bookings of long-haul breaks, with people increasingly opting for cheaper British or Continental holidays - bringing record discounting on the unsold packages.

Experts say the best deals are in South-East Asia, Africa and South America, despite the impact of soaring oil prices on travel costs.

Discounted late breaks include a week at the spa-and-beach resort Las Ventanas al Paraiso in Cabo San Lucas, Mexico. It is available for £3,899 a person rather than the £4,483 advertised - saving £584.

Sam Collins, from Ethos Travel, said: "To get such discounts is a very unusual trend for long-haul flights. I haven't seen these types of offers at this time of year before. This type of summer trip is usually sold out up to eight months in advance but now they are still available."

He added: "The changes occurring in the economy made people wait, and in January people knew it would be a hard year financially."

The cuts come despite warning calls from industry leaders that the international fuel crisis would spell the end of cheap holidays. Chief Executive of the International Air Transport Association, Giovanni Bisignani, said "rocketing oil prices" would push up fares.

Surcharges have been levied on fares by several airlines to cope with the increasing cost of fuel. But the price hikes, coupled with consumer caution, mean airlines face the making a loss on half-empty flights to some destinations - forcing them to slash ticket prices.

A spokesman for the Association of British Travel Agents said last-minute holidaymakers should do their research. "Some travel companies get preferential rates, which is why it always pays to shop around," he said.