Travelers face higher costs and fewer flight options as jet fuel prices swing

A new reality is beginning to emerge for travelers around the world: higher fees, fewer flight options, and difficult decisions about whether a flight is worth the cost.

The reason for this is volatile oil and jet fuel prices, which have risen sharply since the war in the Middle East began, and fighting near the narrow Strait of Hormuz has created a choke point for global oil supplies.

“Volatility is the real story here,” said Shai Gilad, a former airline captain who now teaches at Georgetown University’s business school. “Right now, airlines are trying to bet on what they think will happen in the future.”

Airlines are responding cautiously, cutting schedules and adjusting prices in ways that experts say will impact unevenly across the market but ultimately affect nearly every type of traveler.

Experts say budget airlines and the price-conscious customers who rely on them are likely to feel the hit first and most acutely, but even passengers in premium cabins won’t escape higher prices and less convenient schedules.

Oil prices have swung wildly in recent weeks, briefly topping $119 a barrel at one point, then falling below $95 on Wednesday after President Donald Trump declared a two-week ceasefire in the Middle East that briefly reopened the Strait of Hormuz. But the uncertainty behind these fluctuations remains, especially after Iran closed the main artery for global oil shipments again in response to Israeli strikes in Lebanon.

“When prices move quickly in both directions, it is very difficult for airlines to make forecasts,” Gilad said. “That’s why there’s a gap between oil market movements and what travelers see in ticket prices.”

In other words, even when oil prices fall, travelers may not feel comfortable right away. It can take months, sometimes up to a year, for airlines to adjust prices and fees while they wait for energy markets to stabilize.

“At this level of fuel, it’s hard to call anything temporary,” Delta Air Lines CEO Ed Bastian told reporters this week after the Atlanta-based carrier raised its checked baggage fees.

Global pressure and local influences

Higher fuel prices are expected to add $2 billion to operating expenses in the second quarter alone, Bastian said Wednesday as Delta kicked off U.S. airline earnings season.

If jet fuel prices remain high, it will mean $11 billion in additional annual costs, United Airlines CEO Scott Kirby said in a recent memo to employees. That’s more than double what United earned in its most profitable year.

“For perspective, in United’s best year ever, we made less than $5 billion,” he said.

According to the International Air Transport Association, the average global price of jet fuel rose to $209 per barrel last week, compared to about $99 at the end of February when the war began.

Travelers from the United States to Hong Kong and New Delhi pay the price.

US airlines are incorporating higher operating costs into ticket prices and surcharges. Delta, United, Southwest Airlines and JetBlue have increased their checked baggage fees.

United has gone beyond fare adjustment add-ons in its forward cabins. The carrier said last week that it would bring the already standard “pay for what you want” approach in economy class to its premium cabins, turning perks such as advanced seat selection and fully refundable tickets into optional extras.

Cathay Pacific in Hong Kong recently raised fuel surcharges by nearly 34% on all routes, while Air India on Monday added up to $280 in fees on some flights. Emirates, Lufthansa and KLM have also adjusted fees or prices to keep pace with price fluctuations.

Flight discounts to cut costs

For some travelers, it’s not just the cost, but the uncertainty that is changing the way they plan trips.

Bill Moorhouse, 50, a solutions manager at a global business and technology services company, routinely travels for work every four to six weeks.

“When you have business trips and you have a carefully curated schedule, you don’t want the unknown and the disruptions,” the Cupertino, California, resident said. “And right now, it seems more likely that things will go wrong and your trip will be derailed.”

For now, he stays closer to home.

“I think this is a good time to do spring cleaning and reconnect with friends locally.”

At the same time, airlines are also adjusting the amount of their flights.

BNP Paribas estimates that global schedules for April have been reduced by approximately 5% compared to previous plans. The global investment bank said most of the cuts are taking place in the Middle East, although smaller cuts are also appearing in Europe, Asia and North America.

United Airlines is cutting about 5% of its planned near-term flights, trimming less profitable routes and temporarily suspending some international service rather than “burn money” on flights that can’t absorb more expensive fuel costs. The airline’s CEO said the cuts would target red flights and routes on historically slower travel days such as Tuesday, Wednesday and Saturday.

Delta has canceled its plans to add more flights and seats this summer, leaving about 3.5% fewer seats than originally planned.

Travel plans were upended

These moves show why major carriers are better positioned to withstand rising fuel prices than low-cost carriers, whose “no-frills” model leaves them less flexible to absorb unexpected costs. Major airlines can rely on dynamic pricing, selling more seats at higher prices or substituting larger aircraft on certain routes, allowing them to reduce flights without losing overall capacity.

“Leisure travelers and budget travelers will definitely feel it first because it could make the difference between going and not going,” Gilad said.

It has already made a difference for Anna Del Vecchio. The 36-year-old Seattle resident has made it an annual spring tradition to visit family in Philadelphia before traveling to Paris to see friends she met as a teenager during a volunteer internship.

Her credit card points usually cover the round-trip flight, but ticket prices are now around $1,400, nearly double what she’s paid in years past.

“The flight wasn’t up to ground zero this time, so I decided to postpone the trip,” she said.

But if your airfare costs more than $1,500, you may not be able to take a trip you haven’t missed in years.

“This might be the thing where I end up traveling less.”