- United Airlines CEO Scott Kirby has warned that rising jet fuel prices, which have more than doubled in three weeks, could lead to some airlines failing.
- Kirby said if prices remain at current levels, it would mean an additional $11 billion in annual expenses for fuel, significantly exceeding United’s best−ever profit year of under $5 billion.
- Alan Fyall, an associate dean at the University of Central Florida’s Rosen College of Hospitality Management, told The Los Angeles Times that budget airlines could be hit especially hard since they’re “less resilient” and operate within thin profit margins.
- The increase in oil prices is attributed to the ongoing war with Iran, with forecasts suggesting prices could reach $175 per barrel, making budget airlines particularly vulnerable.
- Travelers are advised to book flights soon as ticket costs are expected to increase by up to 20 percent to offset the rising fuel expenses.
- Separately, the recent Department of Homeland Security shutdown caused significant disruption and billions in losses for the air travel industry, though President Donald Trump signed an executive order to resume paying TSA agents.
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