Flying is Getting Expensive: Why Ticket Prices May Not Drop Even If Fuel Costs Fall
· Telemundo McAllen (KTLM)
Travelers may continue to pay high airfare rates even if oil and jet fuel prices decrease, according to experts and U.S. airlines. Jet fuel prices surged after the war with Iran began, dropped significantly in the spring, and then rose again in the summer. Such fluctuations make it difficult for airlines to plan ahead and give them a reason to be cautious about lowering prices, according to Brett House, an economist and professor at Columbia Business School. During the war, jet fuel has increased even faster than oil, reflecting both the rising cost of crude and a shortage of refined fuel supplies, which is one of the largest operating expenses for airlines. Companies have cut some less profitable flights and increased fares and baggage fees, although major U.S. airlines noted that initially, the increased passenger revenue only covered part of their rising fuel costs. However, airfare has not moved in sync with fuel prices. The Argus jet fuel index in the U.S. plummeted from a peak of $4.88 per gallon in early April to a wartime low of $2.70 in June, but the average airfare remained high.
AI summary · Source: Telemundo McAllen (KTLM) →
