Overview
- Government figures released in late June show average U.S. domestic airfares climbed 4.7% in the first quarter of 2026 to $428 and are the highest inflation-adjusted level since late 2022.
- Officials and data point to a March surge in oil and jet fuel prices driven by the U.S.-Israeli war on Iran as the primary cause of the Q1 fare increase.
- Jet fuel more than doubled from pre-conflict levels and added roughly tens of billions to carrier fuel bills, prompting airlines to raise base fares and add fees to protect fragile margins.
- A sharp drop in spot jet fuel in mid-June created room for savings, but most carriers have so far kept fares elevated to rebuild balance sheets and cover other costs.
- Longer-term limits on capacity growth — including an 18,000-plus backlog of undelivered planes, scarce sustainable aviation fuel, and tight airport slots — mean lower fares could take months to reach travelers.