economy
Will the price of plane tickets go up due to the war with Iran? Here's what to know
As the war with Iran continues, oil prices are soaring and airlines will see higher fuel costs – which could hit travelers around the world in their wallets.
TL;DR
- The war with Iran has caused crude oil prices to surge to nearly $100 a barrel, increasing airlines' fuel costs.
- Fuel is a major expense for airlines, typically accounting for 20-30% of total operating costs.
- Higher fuel prices historically lead to increased airfares, though demand and economic conditions also play a significant role.
- Airlines may cut unprofitable flights, reduce service, and struggle with carriers like Spirit Airlines, potentially leading to less competition and higher prices.
- Airlines use strategies like hedging, fleet modernization, and sustainable fuels to manage fuel costs, with varying success.
- While some international carriers have raised fares, US airlines have not yet broadly increased prices, but this could change if the conflict continues.