[REVISION HISTORY]

Global airlines adjust capacity and fares due to fuel costs

33 recorded revisions of this situation.

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2026-10-26 22:12 UTC → 2026-10-26 23:34 UTC · added ~~removed~~

The surge in jet fuel prices continues to force capacity adjustments and profitability pressures across the aviation industry. Major U.S. carriers, including United, American, Delta, and Southwest, are managing soaring energy expenses. Delta Air Lines has significantly lowered its full-year 2026 profit forecast, reducing expected adjusted earnings per share to a range of $5.10 to $5.60 following a third quarter where fuel expenses climbed 62% year-over-year. Recent financial reports highlight deepening losses for other major carriers. American Airlines reported a net loss of $580 million for the first nine months of 2026, with a third-quarter loss of $269 million. CEO Robert Isom attributed this to rising fuel costs, which increased 67.5% to $4.635 billion. Similarly, JetBlue reported a third-quarter net loss of $257 million as fuel costs climbed 61% to $868 million, prompting the airline to pursue restructuring efforts to reach positive free cash flow by 2028. The Airline Association (ALA) has warned of significant financial risks due to a sharp decline in fuel price hedging. While major groups maintain coverage of 60% to 80% for the winter season, this is expected to drop to between 15% and 40% for the next summer season, leaving companies highly exposed to price fluctuations. ALA president Javier Gándara noted that kerosene represents approximately 30% of airline costs and faces pressure from rising prices and an increasing ‘crack spread,’ alongside the rising costs of emission rights and Sustainable Aviation Fuel (SAF). Looking ahead, American Airlines CFO Devon May has indicated that ticket prices are unlikely to decrease in the near future, even if fuel costs decline. This outlook follows data from the Bureau of Transportation Statistics showing average base fares increased by $31 in the second quarter of 2026 compared to 2025.

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