March 03, 2026
• 5 min read
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Flights across the Middle East remained largely on hold after a weekend of massive disruptions across the Persian Gulf following U.S. and Israeli air strikes against Iran and Iran’s retaliatory strikes. Emirates and Etihad suspended scheduled service while running limited cargo and repatriation flights; Qatar Airways said flights to and from Doha would remain temporarily suspended.
With the campaign expected to last — President Donald Trump said it could span “four to five weeks” or longer — broader geopolitical effects began to surface. Travelers may see operations return, but they could also face higher fares as spring and summer bookings ramp up.
Airfare is closely tied to oil. Oil rose more than 10% week-over-week to above $75 per barrel as of Tuesday, after disruptions around the Strait of Hormuz, through which more than 14 million barrels per day transit. A prolonged closure or slowdown there would tighten global supply and push prices higher.
U.S. airline stocks plunged amid fears of rising fuel costs and potential travel disruptions. Higher costs could prompt some travelers to postpone trips or cancel plans over safety and price concerns. A TD Cowen report noted that near-term airline price action would likely be driven by fuel-cost impacts, putting pressure on airline earnings.
History offers a preview: in 2022, after Russia’s invasion of Ukraine, oil jumped and airlines embedded fuel costs into higher fares rather than using separate surcharges, typically adding $15–$20 per ticket. Fuel is roughly a third of airline costs, second only to labor. Analyst Tom Fitzgerald wrote that airlines usually pass through fuel price increases with a 2–3 month lag if demand stays healthy.
How much fares rise depends on how high oil climbs and how long the disruption lasts. Travel consultant Henry Harteveldt says airlines are likely to recoup much of increased fuel expense by raising premiums in first class, business, and premium economy, keeping many regular coach fares more competitive. That approach, however, helps only carriers with significant premium cabins. Budget airlines, which lack those high-yield seats, could be forced to pass higher costs onto more coach passengers.
If oil reaches sustained levels near $100 per barrel, Harteveldt warns it could be particularly problematic for airlines. Still, demand has been resilient through multiple shocks this decade. Fitzgerald cautioned that impacts on gasoline prices and broader discretionary spending should be watched, but suggested customers may be willing to absorb higher fares—for at least a time.
Ultimately, the key unknown is duration: whether the Strait of Hormuz remains effectively closed and how long oil prices stay elevated. A temporary spike may have a limited effect after airlines adjust, but a prolonged supply disruption could push broader and more persistent fare increases across markets.
Featured image by MARCIN GOLBAN/URPHOTO/GETTY IMAGES
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.
