The ongoing Iran war is causing significant disruptions to summer travel plans, with experts predicting higher airfare, reduced flight availability, and increased schedule volatility due to soaring oil and jet fuel prices. Airlines are already implementing fee increases and service cancellations to offset rising costs, and potential physical jet fuel shortages in Europe could further exacerbate the situation.
Summer travel planning is off to a shaky start as the Iran war continues to impact oil and jet fuel prices across the globe. Experts say summer travel ers should prepare not just for higher prices, but also for fewer flights, 'more schedule volatility and fewer low-fare options.' Here’s what to know:
RELATED: Iran war latest: Strait of Hormuz closed again due to US blockadeBy the numbers: Airfare is already up 15% over the same time last year, and experts say it’ll likely get worse, especially if the critical Strait of Hormuz remains closed. The oil market is expected to take months to recover from shipment disruptions, and fuel prices typically take longer to fall. Jet fuel prices have roughly doubled since the Iran war began.
U.S. airlines have all raised prices on add-on fees to cope with the surge in jet fuel costs, which is airlines’ biggest expense. Alaska, Delta, United, American Airlines, Southwest Airlines and JetBlue have all increased checked baggage fees in recent weeks.
RELATED: Summer airfare is much higher than last year; here’s how much prices are increasingAir Canada is canceling service to New York’s John F. Kennedy International Airport between June and October due to surging jet fuel costs.
Cost isn’t the only concern for airlines, especially those overseas. In Europe, a number of countries are now relying on less than 20 days of coverage in their jet fuel supplies, according to this week’s International Energy Agency report. Supplies haven’t dropped below 29 days since 2020, the report said.
If that falls under 23 days, physical shortages may emerge at some airports, resulting in flight cancellations and higher airfare for the flights that do take off.
'This is no longer just a fuel-price story. For airlines, it is now a network-planning story,' Christopher Anderson, a professor of operations, technology and information management at Cornell University, told The Associated Press. 'Higher fuel costs matter, but so do longer routings, reduced scheduling flexibility and greater uncertainty about what demand will look like even a few weeks out.'
Travelers might see 'a market with later booking patterns, more schedule volatility and fewer low-fare options if this disruption lasts into the core summer season,' he said.
Availability of jet fuel is less of an issue in the U.S., a major oil producer. 'It’s just going to cost more here, whereas in different parts of the world you could actually get to a point where there’s just no fuel,' said Jacques Rousseau, managing director at financial firm Clearview Energy Partners.
Delta Air Lines — which frequently flies to European destinations — said it was 'aware of the potential jet fuel supply issue' in Europe and monitoring the situation. Delta, which bought a refinery in Philadelphia in 2012 to manage its largest expense, said it doesn’t expect any 'near-term impact to our operations.'
The surge in jet fuel prices could be enough to send a shaky Spirit Airlines over the edge. The budget airline is reportedly in talks to potentially liquidate the company’s assets as surging jet fuel prices threaten its plan to come out of a second bankruptcy, multiple reports say.
According to The Wall Street Journal, Spirit had reached a deal with creditors to come out of bankruptcy as a smaller company by this summer. But that was just before the U.S. and Israel launched a war against Iran, which doubled the price of jet fuel.
A Spirit Airlines spokesperson told FOX Local that 'we don’t comment on market rumors and speculation. RELATED: Spirit’s bankruptcy uncertain as jet fuel prices soar'Our operations continue as normal,' the spokesperson said.
If Spirit is forced to liquidate, customers who’ve already bought plane tickets could be the last to get their money back. The Points Guy reports that creditors and other parties will be paid first. Customers will get what’s left, if anything. If you bought your ticket with a credit card, you should be able to get your money back, though it’s not guaranteed. Some travel insurance policies also might cover the cost of the ticket if the airline closes.
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