Airfares in the United States are expected to remain elevated even if jet fuel prices decrease, according to airline executives and industry analysts. The volatility in fuel costs, driven largely by ongoing conflicts in the Middle East, has complicated airlines’ ability to lower ticket prices despite fluctuations in the price of jet fuel.
Jet fuel prices surged after the outbreak of the war in Iran, reaching a wartime high in early April before declining sharply over the summer and then climbing again in recent months. The Argus U.S. Jet Fuel Index reported a drop from $4.88 per gallon in April to $2.70 in June, only to rebound to $4.53 by mid-September. This volatility has strained airlines’ financial planning and operational strategies, as jet fuel constitutes one of their largest expenses.
Brett House, an economist at Columbia Business School, explained that the unpredictability of fuel prices is a significant challenge. Airlines must plan flights months in advance and begin ticket sales even earlier, basing fare decisions on anticipated operating costs. Because of this lead time, sudden price changes in fuel cannot immediately impact fares for tickets already sold.
Industry data supports this disconnect. Despite the fall in jet fuel prices during the summer, average airfares continued to rise—from $405 in the last quarter of 2025 to $436 in the April-June period of this year, according to the U.S. Bureau of Transportation Statistics. In August, airfares were reported to be 23% higher than the previous year, and travel-booking platform Hopper noted that holiday round-trip fares averaged $402 for Thanksgiving and $452 for Christmas, rises of 31% and 23% respectively compared with last year.
Airlines such as American, United, and Southwest have responded by cutting less profitable routes, raising baggage fees, and adjusting flight schedules to manage fuel costs. United Airlines’ CFO, Mike Leskinen, noted that about 35% of tickets for the final three months of the year had already been sold before recent fuel price increases, limiting the airline’s ability to raise fares retroactively. United anticipates gradually recovering higher fuel expenses through revenue but does not expect immediate relief.
The global jet fuel market has mirrored these trends. According to the International Air Transport Association (IATA), jet fuel prices more than doubled from $99 per barrel before the war to over $200 in April, before settling near $195 in mid-September. The price pressures stem from displaced refinery capacity in the Middle East and damage to Russian refining infrastructure due to ongoing conflict, which has tightened supplies of refined jet fuel and diesel—products closely linked in refinery operations.
With fuel expected to constitute nearly one-third of airline operating expenses in 2026, up from about one-quarter in 2025, the cost impact is substantial. American Airlines’ CFO, Devon May, highlighted that even a one-cent increase per gallon adds roughly $10 million to the company’s quarterly fuel bill, projecting that recent price rises will increase fourth-quarter fuel expenses by about $1 billion.
Financial experts underscore that for airfares to decline sustainably, jet fuel prices must not only fall but remain stable over an extended period. Stephen Treanor, a finance professor at Cal State Chico, pointed out that the lag between rising fuel costs and ticket pricing means travelers could continue facing higher fares even if fuel prices drop. Deutsche Bank data reveals that last-minute ticket buyers are already paying steep premiums, with same-day fares on some carriers increasing by more than 20% in a single week.
Given these factors, industry observers suggest that significant reductions in fuel surcharges and airfares are unlikely in the near term, potentially extending beyond the duration of the conflict that has triggered the current price instability.