A fresh surge in oil prices is putting pressure on the cost of flying just as the busy summer travel season peaks. The climb, driven by escalating tensions in the Middle East, is raising concern that airfares could stay elevated for the rest of the summer. Jet fuel is one of the largest expenses airlines face, and as its price rises, the impact tends to ripple through the wider cost of air travel.
The most recent jump was sharp and sudden. From Tuesday to Wednesday, the price of a gallon of jet fuel increased by 20 cents, or about 10 percent, as the flare-up in the Gulf rattled energy markets. That kind of rapid movement in a single day underscores how sensitive fuel costs have become to events unfolding thousands of miles away from the airports where planes take off.
The strain was already showing before this week's spike. Recent figures show that US airlines spent around 6.7 billion dollars on jet fuel in May, roughly 84 percent more than they spent in the same month a year earlier. That steep year-over-year increase illustrates just how much heavier the fuel bill has become for carriers trying to keep their schedules running.
Passengers have felt some of that pressure, though not the full force of it. Over the same period, airfare rose by about 27 percent, a significant jump but still far smaller than the increase in fuel costs. The gap suggests that airlines have not passed the entire burden on to travelers, choosing instead to shoulder a large share of the higher expenses themselves for now.
To cope, carriers have turned to a range of measures. Airlines have been trying to offset the higher costs by cutting routes, retiring less fuel-efficient planes and increasing checked bag fees. For the moment, however, they are absorbing most of the increased costs, recognizing that keeping fares competitive is imperative in a market where travelers can quickly shop around for cheaper options.
Despite the higher cost to fly, demand has shown little sign of cooling. Fourth of July air travel set a new record, and the number of passengers screened by security in the first half of the year was up slightly compared with the same stretch last year. Some airline executives have said they are surprised that appetite for flying remains so strong even as prices climb.
The question now is how long airlines can keep cushioning travelers from the rising cost of fuel. With oil prices climbing amid the conflict in the Middle East, the pressure on carriers is unlikely to ease soon, and industry watchers warn that fares could remain elevated through the rest of the summer if tensions and energy costs continue on their current path.