Shares of all four major U.S. airlines are in freefall as the Iran Crisis drives jet fuel costs up 58% — and United’s CEO is already warning passengers that fare hikes are coming “quickly.”
Shares of every major U.S. airline tumbled as the ongoing 2026 Iran Crisis drove jet fuel costs up 58% from pre-conflict levels, with United Airlines leading losses at nearly -7%, according to live market data from MarketWatch.
American Airlines, Delta Air Lines, and Southwest Airlines were also in the red, sliding approximately -6%, -5.5%, and -5%, respectively, as investors absorbed the financial weight of oil prices breaking above $100 a barrel for the first time since 2022.
The benchmark crude price spike follows U.S. and Israeli air strikes in Iran that fractured global oil supply chains. A refinery in Bahrain was also hit in the conflict, applying additional pressure to fuel markets, the BBC reported.
United Airlines CEO Scott Kirby said the fuel surge would have a “meaningful” impact on the carrier’s first-quarter results. “If it continues, we’ll feel it in Q2 also,” Kirby told CNBC.
Kirby said fare increases would “likely happen quickly,” and pointed directly to the vulnerability created by U.S. carriers’ strategy of not hedging fuel costs — a position that has left them fully exposed to the sudden and steep price shock.
Despite the cost headwinds, Kirby said United’s overall booking pace had not taken too much of a hit. Demand on routes bypassing the Middle East, however, has surged dramatically. “Each day this week, we have booked over 1,000 people from Australia and New Zealand to Europe,” he said. “Last year, we booked [fewer] than one a day.”
For American Airlines, the financial calculus is particularly sobering. Jet fuel ranks as the second-largest operational cost for most carriers after labor, according to Mexico Business News, and a 1% rise in fuel prices alone would add roughly $50 million to the airline’s annual costs. Given the scale of American’s global operations, a sustained run-up in oil prices could accelerate losses well beyond that figure.
The damage has spread well beyond U.S. borders. In northwest Europe, jet fuel prices have nearly doubled — climbing from approximately $830 per tonne to more than $1,500, the BBC reported. The BBC also reported that costs across Europe may have risen by as much as 80% overall, a direct consequence of the Middle East supplying roughly half of the continent’s imported aviation fuel.
European carriers are already counting the cost. Hungarian budget airline Wizz Air is projecting an annual profit decline of €50 million, equivalent to approximately $58 million, according to the BBC. Other European carriers are expected to face similar damage as the crisis unfolds.
Key Takeaways
- All four major U.S. carriers are down sharply: United (-7%), American (-6%), Delta (-5.5%), and Southwest (-5%), as jet fuel costs jump 58% following U.S. and Israeli air strikes on Iran and related supply chain disruption, including a refinery strike in Bahrain.
- Oil surpassed $100 a barrel for the first time since 2022, with United Airlines CEO Scott Kirby warning fare hikes will “likely happen quickly” and flagging the risk of the airline’s unhedged fuel strategy.
- A 1% rise in fuel prices adds approximately $50 million to American Airlines’ annual costs, making the current spike a significant threat to its bottom line.
- United reports a demand surge on routes avoiding the Middle East, booking more than 1,000 Australia-to-Europe passengers daily — compared to fewer than one per day a year earlier.
- European carriers face an equally severe crunch: jet fuel has nearly doubled in northwest Europe, and Wizz Air is projecting a €50 million ($58 million) annual profit drop.
