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Airlines Raise Fares and Cut Flights as Jet Fuel Costs Surge from Middle East War
Major airlines are increasing ticket prices and reducing schedules in response to doubled jet fuel costs driven by the war in Iran and the Middle East. Carriers like American and United report strong travel demand allowing higher fares to persist even if fuel prices fall. Some airlines face earnings cuts and potential shortages, prompting lobbying for UK policy changes.
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Airlines worldwide are raising fares and canceling flights due to surging jet fuel prices stemming from the war in Iran and the Middle East. The conflict has led to the closure of the Strait of Hormuz, doubling jet fuel costs since the start of the year.
Major U.S. carriers, including United, American, Delta, and Southwest, are passing these costs to consumers, with average fares up 20% per mile compared to last year. Thousands of European flights have been canceled, and airlines serving the UK, such as KLM, Air Canada, Asiana Airlines, Delta, Lufthansa, and SAS, plan to operate fewer flights.
In contrast, British Airways owner IAG, EasyJet, and Jet2Holidays have stated they do not plan to change schedules. Long-haul routes, like London to Melbourne, have seen fares rise 76%, and London to Hong Kong up 72%.
and Earnings American
Airlines cut its 2026 earnings forecast, projecting an adjusted per-share loss of up to 40 cents or earnings of $1.10, down from a prior estimate of $1.70 to $2.70. The carrier reported a first-quarter net loss of $382 million, with revenue up 10.8% to $13.91 billion.
Delta faces $2 billion in increased fuel costs for the current quarter alone. The four largest U.S. carriers spent a combined $100 million daily on fuel last year, now paying billions more. Southwest's Chief Operating Officer Andrew Watterson noted five industrywide fare hikes this year, with more expected.
Airlines have recovered only a portion of increased costs through fare increases. United has reduced its schedule by 5% through September, cutting less profitable flights to boost average ticket prices. Spirit Airlines, which has filed for bankruptcy twice in the last two years, warned in March it could go out of business, though the Trump administration is considering a bailout or purchase to keep it afloat.
