The main reason is the unstable prices of oil and aviation fuel, which have surged since the war in the Middle East began, with fighting near the narrow Strait of Hormuz creating a bottleneck for global oil supply.
"Volatility is the real story here," says Shye Gilad, a former commercial airline captain who now teaches at Georgetown University's business school. "Right now, airlines are trying to bet on what they think will happen in the future."
Airlines are responding cautiously, cutting flight schedules and adjusting prices in ways that experts say will unevenly ripple across the market but ultimately affect nearly every type of traveler. Budget airlines and price-sensitive travelers are likely to feel the impact first and most, experts say, but even premium cabin passengers won't escape higher prices and less convenient flight schedules.
Oil prices have been volatile in recent weeks, briefly exceeding $119 per barrel before dropping below $95 on Wednesday after President Donald Trump announced a two-week ceasefire in the Middle East that temporarily reopened the Strait of Hormuz. However, the uncertainty behind these fluctuations remains, especially after Iran reclosed this key artery for global oil deliveries in response to Israeli strikes in Lebanon.
"When prices move rapidly in both directions, it's very difficult for airlines to make forecasts," says Gilad. "That's why there's a lag between movements in the oil market and what travelers see in ticket prices."
In other words, even when oil prices fall, travelers may not feel immediate relief. Airlines may need months, sometimes up to a year, to adjust ticket prices and fees while waiting for energy markets to stabilize.
"At this level of fuel prices, it's hard to call anything temporary," Delta Air Lines CEO Ed Bastian told reporters this week after the Atlanta-based airline increased checked baggage fees. On Wednesday, as Delta kicked off the U.S. airline earnings season, Bastian said higher fuel prices alone are expected to add $2 billion to operating costs in the second quarter.
United Airlines CEO Scott Kirby stated in a recent internal message to employees that if jet fuel prices remain elevated, it would mean an additional $11 billion in annual costs—more than double what United earned in its most profitable year. "For comparison," he noted, "in United's best year in history, we earned less than $5 billion."
According to data from the International Air Transport Association (IATA), the global average price of jet fuel rose to $209 per barrel last week, up from about $99 in late February when the war began.
Travelers from the U.S. to Hong Kong and New Delhi are now paying the price. U.S. airlines are embedding higher operating costs into ticket prices and additional fees. Delta, United, Southwest Airlines, and JetBlue have all increased checked baggage fees.
United has gone a step beyond ancillary services by adjusting prices in its front cabins. Last week, the company announced it is introducing a "pay for what you want" approach, already standard in economy class, to premium cabins, turning perks like advance seat selection and fully refundable tickets into extra paid options.
Hong Kong's Cathay Pacific recently raised fuel surcharges by about 34% on all routes, while Air India added up to $280 in fees on some flights on Monday. Emirates, Lufthansa, and KLM have also adjusted fees or fares to keep up with price volatility.
For some travelers, it's not just the price but the uncertainty that is changing how they plan trips. Bill Moorehouse, 50, a solutions director at a global business and technology services company, travels for business regularly every four to six weeks. "When you have business trips and a carefully aligned schedule, you don't want unknowns and disruptions. And right now, it just seems more likely that something will go wrong and derail a trip," said the Cupertino, California resident. For now, he's staying closer to home. "I think this is a good time to do spring cleaning and reconnect with friends in your city."
Meanwhile, airlines are also adjusting flight volumes. BNP Paribas estimates that global flight schedules for April have been cut by about 5% compared to earlier plans. Most of the reductions are in the Middle East, the investment bank reported, though smaller cuts are also appearing in Europe, Asia, and North America.
United Airlines is reducing about 5% of planned flights in the short term, eliminating less profitable routes and temporarily suspending some international flights instead of "burning cash" on trips that can't sustain higher fuel costs. The company's CEO said the cuts will target overnight flights and routes on days with traditionally weaker demand, such as Tuesdays, Wednesdays, and Saturdays.
Delta is abandoning plans to add extra flights and seats this summer, leaving about 3.5% fewer seats than originally planned. These moves show why major carriers are better positioned to weather the fuel price spike than budget airlines, whose "no-frills" model leaves less room to absorb unexpected costs.
Larger airlines can rely on dynamic pricing, sell more seats at higher fares, or deploy larger aircraft on specific routes, allowing them to reduce flight frequency without cutting overall capacity. "Leisure travelers and those particularly budget-conscious will absolutely feel it first, because it could be the difference between going and staying home," says Gilad.
Anna Del Vecchio has already felt the difference. The 36-year-old Seattle resident has had a spring tradition for years of visiting family in Philadelphia and then flying to Paris to see friends she met as a teenager during a volunteer internship. Her credit card points usually cover a round-trip plane ticket, but prices now run about $1,400—nearly double what she paid in previous years. "This time, the points didn't even scratch the surface of the flight cost," she said, "so I decided to postpone the trip." But if the plane ticket price exceeds $1,500, she may not be able to take the trip she hasn't missed for years. "It might just be a situation where I have to travel less."