Holiday Airfares Could Reach 10-Year High

Americans traveling for the holidays this year could face sticker shock as high jet fuel costs stemming from the Iran war drive up domestic airfares, according to a new forecast.   The average round-trip ticket for a flight within the U.S. during the Thanksgiving break is $402, up $95 from the same period a year ago, fare aggregator Hopper said in an analysis. Round-trip domestic airfares around Christmas are averaging $452, up $85 from last year, according to the firm. 

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Tickets for round-trip flights in the U.S. are already up 31% compared to the same period last year, reflecting elevated jet fuel costs, according to Hopper.  “Months of elevated jet fuel costs due to the conflict in Iran have contributed to Thanksgiving and Christmas airfares reaching 10-year highs,” the company said.

The conflict in the Middle East has choked oil flows from the region, constraining global supply. As oil prices have risen, the cost of distillates such as jet fuel and diesel has also jumped. To offset those costs, airlines have hiked fares, tacked on passenger surcharges and cut routes. Typically, jet fuel costs account for up to 30% of an airline’s operating costs, according to airline industry analysts. Before the Iran war began in late February, jet fuel averaged about $99 per barrel globally, according to the International Air Transport Association. It peaked at $209 in April and hit $195 a barrel in mid-September, IATA said, citing data from S&P Global Energy Platts.

Source: CBS News