Jet fuel prices have surged nearly $2 per gallon since late February, leading major airlines to either propose raising ticket prices or to admit that fare hikes are imminent.
The cost per gallon jumped from $2.50 on Feb. 27 to $4.26 in recent weeks, according to data tracked by Airlines for America. The price increase is attributed to the war with Iran, which has limited global oil and energy supplies.
Experts warn that these rising costs are already being passed on to consumers as airlines struggle to maintain their bottom lines amid high travel demand.
Patrick Dehaan with GasBuddy told KIRO 7 that the rapid price increase has left airlines with few alternatives.
“Jet fuel prices have been exploding the last two-and-a-half weeks, and airlines have had no choice but to pass those increases along,” Dehaan said. He noted that the impact would extend beyond passenger travel, adding that “jet fuel prices are going to lead to higher shipping costs and higher airfares as well.”
Major carriers have already begun responding to the price surge.
United Airlines’ CEO confirmed ticket prices will increase, while executives at other airlines have hinted at similar moves.
Dehaan noted that some travelers may already be seeing these changes, with some summer airfares to Europe rising by 20%.
Alaska Airlines, the largest carrier in the Pacific Northwest, faces specific financial pressure due to its location and fleet size. The company boasts over 400 aircraft in its fleet, consuming approximately 100-200 million gallons of fuel every month. Because of this high volume, every $1 increase in fuel prices adds potentially $100 million to the airline’s monthly operating costs.
Alaska Airlines CEO Ben Minicucci was quoted by Aviation Week as saying the company pays more for fuel because the West Coast has less refinery capacity than other regions. The article also said the airline is utilizing its merger with Hawaiian Airlines to access fuel sourced from Singapore, which is transported to Hawaii by tanker and is also a bit cheaper.
The ongoing war with Iran is cited as the primary driver behind the supply disruptions and price hikes. Courtney Federico, a representative with the Center for American Progress, said a resolution to the conflict is likely necessary before prices stabilize.
“Until the Strait of Hormuz reopens and these energy supplies are again flowing, I think it’s going to be difficult to bring prices down,” Federico said.
Dehaan expects that airfares could remain elevated for several months. Future price trends will depend on the reopening of energy supply routes and the status of the conflict in Iran.
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