BUCKLE UP. THE SUMMER OF SKY-HIGH TRAVEL COSTS IS APPROACHING.

Travel is getting more expensive by the day and Americans will be hit by sky-high costs for a summer getaway.

U.S. airlines are facing billions of dollars in extra fuel costs in the months ahead as a result of the Iran war. Unfortunately, their plan to mitigate the impact involves travelers picking up part of the bill.

It’s already started. Airline fares jumped 15% year-over-year in March, consumer price index data showed on Friday. Fares rose 2.7% over the month in March, after a 1.4% increase in February.

It isn’t the only cost increase travelers will have to bear. Major U.S. airlines have hiked bag fees in recent days in a bid to offset surging jet fuel costs. Delta Air Lines, American Airlines, Southwest Airlines and United Airlines have all increased their first checked bag fee by $10 to $45.

Delta Air Lines laid bare the impact of surging jet fuel prices when it reported earnings Wednesday. The carrier said fuel costs in the current quarter would increase by more than $2 billion. That’s with a projected fuel price of $4.30 per gallon, up from $2.62 in the first quarter.

Demand is surging and that strength is holding up even in the face of fare increases. That points to carriers having more confidence to hike ticket prices.

“The premium consumer is candidly immune or becoming more immune to the headlines and not delaying their investment in the experience economy,” Delta CEO Ed Bastian said on the earnings call.

“Encouragingly, Delta continues to see broad-based demandstrength despite multiple fare/fee increases,” Raymond James analyst Savanthi Syth noted.

That’s scant consolation for those hoping to fly somewhere this summer—unless they also happen to own Delta stock. Syth rates the shares a Strong Buy with a price target of $80.

There is some hope, though. Delta’s guidance was based on forecasts made on April 2—before the U.S.-Iran cease-fire was announced. If peace prevails, jet fuel prices will ultimately come down, but it’s unlikely to be a swift return to normal.

It could be months before jet fuel supplies recover, International Air Transport Association CEO Willie Walsh said last week. “Even if you have the flow of crude start again, if you’ve had disruptions in refining capacity, then the problem continues for some time,” he told reporters in Singapore, according to multiple reports.

Oil flows in the Strait of Hormuz still remained limited even in the days after the two-week cease-fire was announced and President Donald Trump’s move to put a U.S. blockade in the vital waterway won’t help matters. The longer traffic through the strait remains stifled, the greater—and longer—the impact on airfares.

The U.S. airline industry could face an annual fuel-cost headwind of close to $40 billion, Deutsche Bank analysts warned last week, albeit hours before the cease-fire was agreed.

“Given the elasticity of demand for air travel, we believe airline fare increases are more likely ‘to stick’ when the industry is benefiting from a health demand environment and seat growth is at or below GDP growth,” analyst Michael Linenberg said. “Currently, we believe both conditions are present.”

With airlines looking to cut capacity, demand remaining strong, and fuel prices still high, it’s increasingly looking like a summer of higher travel costs.

Write to Callum Keown at [email protected]

2026-04-14T05:13:01Z