Air travel is becoming much more expensive this summer because jet fuel prices have gone up sharply during the Iran war. Jet fuel costs have jumped more than 100% since the war started. Airlines are now cutting thousands of flights because fuel is becoming too expensive and difficult to get. The US Travel Association said airline ticket prices in March were 14.9% higher compared to March last year.
A major reason behind the crisis is the near shutdown at the Strait of Hormuz. JPMorgan said the disruption at the Strait of Hormuz removed more than 13 million barrels of crude oil from the market. Crude oil is important because refineries use it to make products like gasoline, diesel, and jet fuel. GasBuddy analyst Patrick De Haan said aviation fuel is usually the first product to get affected when refinery output becomes tight globally. Patrick De Haan explained that gasoline and diesel are usually given priority because they are more important for industries like farming and freight transport, as noted by Yahoo Finance.
Bloomberg data showed that US Gulf Coast jet fuel swap prices are still around 50% higher than before the war. Jet fuel prices are currently trading above $330 per gallon compared to around $234 per gallon a month earlier. NYSE:DAL said in April that rising jet fuel prices could add nearly $2 billion in costs during the second quarter. NASDAQ:AAL said it expects around $4 billion in extra expenses for the full year.
Budget airlines are under even more pressure because they already operate with smaller profits. Spirit Airlines recently collapsed after facing major financial problems and restructuring challenges. Yahoo Finance reported that rising fuel costs added even more pressure on Spirit Airlines before its collapse.
Flight tickets are becoming expensive because jet fuel prices have increased sharply due to the Iran war and oil supply disruptions.
Q2. Why are airlines cutting flights this summer?
Airlines are reducing flights to save fuel costs as global jet fuel supplies become tighter and more expensive.
A major reason behind the crisis is the near shutdown at the Strait of Hormuz. JPMorgan said the disruption at the Strait of Hormuz removed more than 13 million barrels of crude oil from the market. Crude oil is important because refineries use it to make products like gasoline, diesel, and jet fuel. GasBuddy analyst Patrick De Haan said aviation fuel is usually the first product to get affected when refinery output becomes tight globally. Patrick De Haan explained that gasoline and diesel are usually given priority because they are more important for industries like farming and freight transport, as noted by Yahoo Finance.
Jet fuel supply crisis
The Strait of Hormuz blockage has disrupted about 20% of the world’s seaborne jet fuel and kerosene supply. This has created a double problem for airlines because both crude oil supplies and finished jet fuel deliveries are getting affected. Patrick De Haan said jet fuel and kerosene supplies could fall by around 620,000 barrels per day during the second quarter of 2026. The supply drop is happening because shipments through the Strait are being interrupted and Asian refineries are producing less fuel, according to De Haan.Airlines facing big costs
Many Asian refineries depend heavily on crude oil coming from the Middle East. Airlines are now facing massive operating costs because jet fuel is one of their biggest expenses. Experts say airlines cannot absorb these extra costs for long, so passengers will likely end up paying more for tickets. Airlines that do not have strong fuel price protection plans are being hit the hardest, according to Yahoo Finance. Airlines also struggle to increase ticket prices quickly in highly competitive markets.Bloomberg data showed that US Gulf Coast jet fuel swap prices are still around 50% higher than before the war. Jet fuel prices are currently trading above $330 per gallon compared to around $234 per gallon a month earlier. NYSE:DAL said in April that rising jet fuel prices could add nearly $2 billion in costs during the second quarter. NASDAQ:AAL said it expects around $4 billion in extra expenses for the full year.
Airlines cutting flights
Ed Bastian said Delta is reducing flight capacity in the current quarter because of the fuel situation. Ed Bastian said the airline industry urgently needs to cut expensive and unprofitable flights until fuel prices improve. He also said high fuel prices force weaker airlines to either merge, restructure, or shut down completely. Airlines are facing this pressure just as the busy summer travel season is starting.Europe jet fuel warning
Fatih Birol warned last month that Europe had only about six weeks of jet fuel supply left. Lufthansa recently cut 20,000 flights through October to save fuel costs, according to Yahoo Finance. In the US, airlines including NASDAQ:UAL, Delta, and American Airlines have reduced schedules on some routes. Ed Bastian recently said airlines are already increasing fuel surcharges and ticket prices to protect their profit margins.Budget airlines are under even more pressure because they already operate with smaller profits. Spirit Airlines recently collapsed after facing major financial problems and restructuring challenges. Yahoo Finance reported that rising fuel costs added even more pressure on Spirit Airlines before its collapse.
FAQs
Q1. Why are flight tickets getting expensive in 2026?Flight tickets are becoming expensive because jet fuel prices have increased sharply due to the Iran war and oil supply disruptions.
Q2. Why are airlines cutting flights this summer?
Airlines are reducing flights to save fuel costs as global jet fuel supplies become tighter and more expensive.
