Airlines get bigger benefit from fluctuating fuel costs, study says

With fuel costs continuing to drop, a new study finds that the relationship between fuel prices and air fares benefits airlines more than passengers.

The study by the travel research site found that over the past 22 months fares have remained flat when fuel prices have dropped. But when fuel prices have increased, fares have jumped more than three times the increase in fuel costs, according to the study.

Fuel, on average, represents about 30% of an airline’s operating costs.

Airlines disagree with the premise of the report, saying profitable times allow carriers to improve their service, expand to new markets and pay down debt.


“Do you pay less at Starbucks when the cost of coffee beans falls?” asked Jean Medina, a spokeswoman for Airlines for American, the trade group for the nation’s airlines. “Presumably you want Starbucks to expand its stores, offer new beverage choices and share profits with its baristas and stockholders. We are no different.”

To read more about travel, tourism and the airline industry, follow me on Twitter at @hugomartin.

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