Jet fuel prices are rising as war in the Middle East disrupts global oil supplies, putting pressure on airline costs as the peak summer season approaches.
According to experts, it is not a question of whether plane ticket prices will increase, but when, for how long and by what amount. The impact could be felt most on international routes, which use more fuel than shorter flights.
Kerosene prices are rising because the war is curbing oil exports and pushing major producers like Kuwait, Saudi Arabia and Iraq to cut production as shipments face increasing obstacles.
The instability of crude oil prices, which led to a sharp rise in gasoline prices at the pump, had the same effect on the price of kerosene. The average U.S. price rose to $3.99 a gallon Friday, up from $2.50 the day before the war began two weeks ago, according to the Argus U.S. Jet Fuel Index.
Some airlines are partially protected against sudden price increases through fuel hedging, a strategy that allows them to lock in fuel prices months or even years in advance. But not all airlines use coverage, and those that do are typically only protected for a portion of their fuel needs.
Another factor for airlines: Airspace closures have forced flights to be rerouted around parts of the Middle East, which can result in longer routes.
They could add or increase fuel surcharges, additional fees common with carriers outside the United States that are added to the base ticket price.
Major U.S. airlines, however, do not charge a separate fuel surcharge. Instead, they incorporate fuel costs into the overall ticket price, meaning any increase will more likely result in a higher base fare for travelers, according to Tyler Hosford, director of security at International SOS, an international risk management company.
Airlines can also adjust the price of their premium options — such as seat upgrades. This means that even if the base fare doesn’t increase immediately, the total cost of a trip could still increase once additional fees are taken into account.
Travelers planning trips this summer could limit the impact of rising airfares by booking earlier rather than waiting for last-minute deals, experts say.
By locking in ticket prices earlier, it is possible to secure lower fares before airlines adjust their prices further.
