Just like regular consumers at the gas station, airlines refueling in Los Angeles are being forced to adjust to higher prices at the pump.<\/p>\n
Jet fuel prices have shot up, and experts say airfares are following suit.<\/p>\n
With a busy summer travel season approaching, airlines are starting to pass the costs on to passengers through higher fares and fees. <\/p>\n
\u201cWhenever there\u2019s a surge in oil prices, the airlines end up passing that to the consumers immediately,\u201d said Diego Bufquin, director of hospitality management and entrepreneurship at Tulane University. \u201cIt doesn\u2019t take a long time.\u201d<\/p>\n
Airlines have been struggling around the world since the U.S. and Israel began bombing Iran late last month. Flights have to take longer paths around war zones, and higher fuel costs eat into their already razor-thin profit margins. <\/p>\n
Jet fuel prices account for about a third of airlines\u2019 operating costs, so they \u201ccannot afford to wait to upcharge their customers,\u201d Bufquin said.<\/p>\n
United Airlines Chief Executive Scott Kirby told CNBC <\/a>that the spike in fuel prices will have a \u201cmeaningful\u201d impact on the airline\u2019s financial results.<\/p>\n Some airlines outside the U.S. have already added fuel surcharges to their ticket fees. Air India announced<\/a> a phased increase in fuel surcharges on domestic and international routes last week. Hong Kong\u2019s flag carrier Cathay Pacific announced it would charge extra on all fares to cover fuel costs starting Wednesday. <\/p>\n Airlines topping up at LAX and other regional airports are already being hit. Jet fuel prices in Los Angeles have jumped more than 40% since the conflict in the Middle East started.<\/p>\n Just like the price of gas for cars, jet fuel often costs considerably more<\/a> in California than in other states.<\/p>\n California is largely detached from the rest of the fuel distribution system. With limited pipeline connectivity, it relies more on sea delivery from other states and countries. California also has higher taxes on jet fuel than many other states. <\/p>\n National average gas prices reached $3.71 per gallon on Tuesday, according to AAA. In California, the average Tuesday was $5.52 per gallon.<\/p>\n Still, spring and summer demand is likely to remain strong even if prices rise, said Alan Fyall, an associate dean of the University of Central Florida Rosen College of Hospitality Management.<\/p>\n \u201cFares are going up, but the demand is still there domestically,\u201d Fyall said. \u201cThe only thing that really dampens demand is economic recession.\u201d<\/p>\n Indeed, consumers have been booking earlier than usual to lock in lower prices for their summer travel, airlines said. Delta<\/a> and American Airlines had some of their strongest-ever single-day sales in March. <\/p>\n \u201cWhen prices did spike, we saw a spike in demand,\u201d Alaska Airlines Inc. Chief Executive Ben Minicucci said this week, according to Bloomberg. \u201cI think people got this initial, \u2018Wow, if this thing is going to go crazy, I better book my fare now before fares go up.\u2019\u201d<\/p>\n Airlines and other industries will face tougher conditions if fuel prices remain high for a prolonged period, he added.<\/p>\n