WASHINGTON (dpa-AFX) - United Airlines (UAL) has issued a warning that ticket prices could increase by as much as 20 percent, if the prices of jet fuel remain high.
The company has attributed this potential increase to the ongoing pressures on airline profitability caused by elevated oil costs. Scott Kirby, the CEO of United, indicated that the airline is already feeling the effects of the fuel market fluctuations and anticipates some consumer pushback should fares rise further, although demand continues to be robust at present.
In response to the rising costs, United has implemented a 5 percent reduction in capacity on routes deemed unprofitable, where the higher operational expenses can no longer be justified. The airline's internal planning suggests that oil prices could escalate to $175 per barrel and potentially remain above $100 through the end of 2027, leading management to prepare for sustained high expenses.
Additionally, United Airlines has recently suspended certain routes and reduced flight frequencies due to the impact of geopolitical tensions in the Middle East on fuel markets and the stability of regional airspace.
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