A Lufthansa airliner is parked at a boarding gate while a SASCA tanker serves it on the apron of Toulouse Blagnac airport in Blagnac in Occitanie in France on March 15, 2026.
Isabelle Souriment | AFP | Getty Images
Soaring jet fuel prices aren’t the airline industry’s only problem. Now it’s a question of whether there will be enough.
Since the United States and Israel attacked Iran on February 28, the price of jet fuel in the United States has nearly doubled, from $2.50 per gallon on February 27 to $4.88 per gallon on April 2, with even greater increases in other regions. The effective closure of the Strait of Hormuz chokes off the supply of crude and refined products like jet fuel, further driving up prices.
This is forcing airlines to consider reducing flights, particularly abroad.
Carsten Spohr, CEO of Germany’s Deutsche Lufthansa, told employees in a webcast last week that the airline was assigning teams to develop contingency plans due to the war in the Middle East, including in the event of a drop in demand or a shortage of jet fuel, a spokesman said. These plans could include grounding some of its planes.
The United States produces a lot of jet fuel and is not as exposed as other regions like Europe and parts of Asia in comparison. But planes are filling up locally, so some U.S. airlines could face shortages on international travel.
United Airlines CEO Scott Kirby told reporters late last month that the airline, which flies the most to Asia among U.S. airlines, would have to reduce flights to that destination. He also said it was “not impossible” that airlines would be forced collectively to reduce services to that region.
He noted that as the price of jet fuel rises, the situation could be more severe in parts of the United States that are not as connected by pipelines.
“There’s not enough refining capacity, and so the price of fuel before this and in the future is more likely to experience supply weakness on the West Coast than anywhere else in the country,” he said.
Kirby told employees earlier in March that the airline was preparing for oil to stay above $100 a barrel through 2027 and was reducing some of its flights in the short term.
“To be clear, nothing is changing in our long-term plans for aircraft deliveries or total capacity for 2027 and beyond, but there is no point in spending money in the short term on flights that simply cannot absorb these fuel costs,” he said in a March 20 message to employees.
Travel request wildcardAcross the board, airlines are cutting some flights for the coming months, although they often adjust their schedules throughout the year based on demand, plane availability or other complications.
Domestic capacity of U.S. carriers in the second quarter is up 2.1%, down from previous plans of 2.3% growth, while total capacity is expected to increase 1.1%, up from 2.4% for the week ended March 20, according to a UBS report released Monday.
“We expect further capacity reductions in the coming weeks,” UBS said.
So far, airline executives have said travel demand is strong, but fuel tensions and price spikes pose a headache for carriers and passengers as the peak summer travel season approaches.
Fuel is typically airlines’ biggest expense after labor, and carriers are already raising airfares and fees, such as those for checked bags, to offset the added cost.
A truck parks after refueling an Airbus Citilink at Soekarno-Hatta International Airport following the government’s approval of a jet fuel surcharge amid the U.S.-Israeli conflict with Iran, in Tangerang, a suburb of Jakarta, Indonesia, April 6, 2026.
Ajeng Dinar Ulfiana | Reuters
Investors will be tuning in to learn more about how rising jet fuel could affect the industry as airline earnings kick off Wednesday with Delta Airlines. This carrier owns a refinery and could therefore benefit from jet fuel sales.
Delta Tuesday increase in checked baggage feesjoining JetBlue Airways and United, who did the same last week.
Strong demand, especially compared to the same period last year, could further insulate airlines, at least in the United States. Last year, reservations fell when President Donald TrumpThe trade war began with high tariffs, collapsed markets and government layoffs, led by Elon MuskThe so-called Ministry of Government Effectiveness came into force.
“Positive comments on demand still hold, but fuel at $4/4.50 [a gallon] any longer, it’s not something airlines can get through,” said Savanthi Syth, an airline industry analyst at Raymond James. “If fuel stays high, you’ll just see capacity be reduced.”
Airlines could see a bigger problem if rising gas prices and other pressures on consumers lead to lower spending.
“We are monitoring the airlines very closely at the moment. It should not last too long in these cases. [fuel price] levels before we start to see potential for ratings pressure,” said Joseph Rohlena, a senior director at Fitch Ratings who covers U.S. airlines.
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