A JetBlue plane lands below the D.C. skyline featuring the U.S. Capitol Building, near United Airlines, American Airlines, and Delta Air Lines aircraft on the tarmac at Ronald Reagan Washington National Airport in Arlington, Virginia, USA, January 25, 2025.
Jim Urquhart |Reuters
U.S. lawmakers are urging the CEOs of the nation’s largest airlines to lower prices if the cost of jet fuel falls, after this year’s steep price increases have prompted airlines to raise surcharges, baggage fees and fares.
“If airline pricing is truly tied to global fuel costs, then they must truly respond when those costs go down,” U.S. Representative Ritchie Torres of New York said in a letter to airline CEOs. delta airlines, united airlines, jet blue airlines and southwest airlinesAccording to a letter seen by CNBC. “We demand a public commitment to reduce the costs associated with air travel when jet fuel prices decline. Americans deserve fairness and a pricing model that reflects not only market conditions but also economic justice.”
Fuel is the biggest expense for airlines after personnel costs. Jet fuel prices in New York, Houston, Chicago and Los Angeles averaged $4.88 per gallon on April 2, according to Argus, an increase of about 95% since the U.S. and Israel began attacking Iran on February 28. The rise was even steeper in other regions that produce less oil and jet fuel than the United States.
United declined to comment. Other carriers did not respond to requests for comment.
Delta Air Lines reported $2 billion in fuel headwinds this quarter and said it would reduce its supply plans “significantly,” something other airlines are likely to discuss in their earnings reports next week.
Reduced capacity could lead to higher freight rates, especially if demand remains strong. On the other hand, lower fuel prices could encourage airlines to expand capacity, which could work in the opposite direction to pricing.
Asked what would happen if fuel prices come down from recent highs, Delta Air Lines CEO Ed Bastian said, “Fuel recovery is going to be important. Whatever we do, regardless of how much we can maintain the pricing strengths that we talked about in streamlining the industry, that will certainly help drive margins this year and obviously next year as well.”
Delta Airlines, United Airlines, Southwest Airlines, JetBlue Airways, american airlines and alaska airlines Since the attacks began, all airlines have increased baggage fees, and airlines around the world have increased airfares and surcharges.
Consumers who want to spend more on travel are driving the airline industry. Bastian told analysts last week that demand is holding up.
“I think high-end consumers, luxury consumers, are frankly immune to headlines, or are becoming more immune to headlines, and they’re not delaying investing in the experience economy and waiting at the last minute to see what the next headline is,” he said.
