The cruise industry's bounce back will be further fueled by the Centers for Disease Control and Prevention (CDC) lifting its risk advisory for cruise ship travel, according to Virgin Voyages CEO Tom McAlpin.

"There's incredible pent-up demand," McAlpin, the president as well as chief executive of Richard Branson's cruise line, told Yahoo Finance in an interview (video above). "We are starting to see it. Bookings are up significantly, 125% over just January levels. Last week, we had our a record booking week and we are gonna surpass that this week."

"People just want to get out," he added. "The number one thing that people wanna do is they want to travel and what a great value than to go on a cruise, go on a Virgin Voyages, because it's a great value."

And while the CDC to drop its travel advisory for cruising, the health agency doesn't consider the activity to be without any risk: it put cruise ships at a "Level 2" risk, signaling moderate COVID-19 risk.

"Travelers will make their own risk assessment when choosing to travel on a cruise ship, much like they do in all other travel settings," CDC spokesperson Jasmine Reed told Yahoo Finance in a statement.

"We're very excited about it," McAlpin said. "We finally see that the CDC has been listening to what we've been saying for a long time: that cruising is the safest way to travel. Of course, they have a tough job, but I think that they finally realize that cruising is safe."

McAlpin stressed that mitigation strategies, especially vaccinations, have been a "game-changer" for cruise lines.

"The combination of that, plus testing of everybody before they get on board, it really is safer than going to your local theater or your local drug store or anywhere," the executive said. "So we're very excited about lifting that ban, and what we want to be treated the same way that any other segment in the travel industry is treated. That's important for us."

Russia-Ukraine implications on cruise industry

Virgin is focused on launching four ships by the end of 2023, though the Russian invasion of Ukraine and subsequent spike in energy costs pose unwelcome headwinds for the industry on the verge of recovery.

"We have two ships that'll be operating this summer in Europe, but we're far away from any of the conflict areas," McAlpin said when asked about the geopolitical situation.

He added that with 300 Ukrainian and close to 80 Russian crew members aboard ships, the operator is helping affected staff with resources if needed.

"We're extending their contracts where they want to," he said. "We're sending them home if they want to get home. We're really looking out for them. It's a tragic situation there. We're respectful of that, but we're keeping our distance from that region."

The cost of West Texas Intermediate, a common oil benchmark, is currently hovering around $100 a barrel, which has hit modes of travel of all kinds. The spike in oil prices is causing sticker shock for drivers at the pump and even caused some airlines to hike airfare ticket prices to cover rising fuel costs.

Virgin Voyages isn't quite to that point yet, McAlpin said.

"Fuel is a component obviously of our cost, but it is not as high of a percentage as you will see in the airline [industry]" McAlpin said. "So it's not a significant part of our cost structure. Of course, we don't like it. We also believe that costs will come down in the future."

But if demand goes up, there could be price increases ahead.

"That's a natural evolution. We encourage people to get out there now, get out there early, make your bookings," McAlpin said. "As demand picks up and as the inventories fill, of course, the prices do go up, but that's not necessarily driven by just fuel that's a supply-demand issue."

'Investors remain decidedly split on... cruise more broadly'

Wall Street analysts are optimistic about the recovery for cruising.

Deutsche Bank’s Chris Woronka appeared bullish in a note about Carnival Corp (CCL) stock to clients last week.

"While management commentary regarding booking patterns and pricing remains unambiguously upbeat, particularly for 2023 itineraries, our sense is that investors remain decidedly split on CCL specifically and cruise more broadly," Woronka wrote.

"Pent-up demand from cruise loyalists, coupled with embedded demand resulting from future cruise credits (FCCs) that mostly need to be redeemed within the next 12-15 months, are well understood narratives at this point," he added. "We do see historically strong onboard spend as likely being a bit under-appreciated in both sell-side and buy-side models at this point, although the durability of this highly discretionary revenue can reasonably be called into question given the multitude of inflationary pressures currently burdening consumers (and thus travelers)."

Richard Branson's cruise line is targeting one type of consumer in particular: Virgin Voyages was launched in an attempt to redesign cruises for younger travelers, targeting millennials and first-time cruisers.

"We really don't focus on age," McAlpin said. "We really look for people young at heart, people who want a different experience. Cruising is a great industry. We wouldn't be here if cruising wasn't great. What we're trying to do is just create a different way to travel, a different way to cruise."

Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter: @daniromerotv

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