While drivers are feeling the pinch, the aviation sector is also experiencing turbulence. The cost of jet fuel and kerosene-based products nearly doubled following the initial geopolitical shock, jumping to more than $200 per barrel. Airlines, which operate on tight margins, are being forced to pivot aggressively to survive the crisis since fuel represents one of their largest overhead costs.
As such, airlines including American Airlines, British Airways, Delta, Lufthansa and United Airlines, have announced capacity cuts, scaling back on flight schedules and consolidating routes to maximize fuel efficiency per passenger. Spirit Airlines took the biggest hit, shutting down in May after failing to secure emergency funding. In Europe, where reliance on Middle Eastern imports is particularly high, major airlines have warned of jet fuel shortfalls that could directly impact summer capacity.
Fares on international routes have jumped substantially, and specific fuel surcharges now reach upwards of $150 on long-haul tickets. Airlines that locked in fuel prices before the war through hedging strategies are currently reaping the benefits and insulating themselves from the worst of the shocks, but warn that they cannot fully offset the impact from the rise of refined product prices.