The price of jet fuel is twice as much as it was last year, according to U.S. federal data – an ominous sign for cash-strapped summer revelers ahead of what is expected to be a busy travel season.
The spot price for jet fuel was $3.517 per gallon as of Monday, according to data from the US Energy Information Administration for the Gulf Coast. That’s approximately twice as high as the same week one year ago, when the spot price was $1.765.
Prices are even higher out of New York Harbor, which serves as a resupply hub for airlines in the northeast. EIA data showed prices in New York were hovering above $6 per gallon earlier this month.
The surging costs are bad news for airlines contending with financial pressure as well as travelers who bear the cost as ticket prices rise to account for the fuel expenses.
The exorbitant cost of plane tickets was reflected in the Consumer Price Index earlier this month. Airline fares jumped a whopping 33% last month compared to the previous April, while overall price inflation hit 8.3%.
More than three million Americans are expected to travel by air this Memorial Day weekend, according to AAA data. While the number still trails pre-pandemic levels, it is up 25% compared to last year, when 2.41 million Americans traveled by air over the holiday.
Aside from impacting travelers’ wallets, the surge in jet fuel prices has created another financial headache for US airlines who are attempting to return to profitability after a years-long slowdown related to the COVID-19 pandemic.
A struggling global energy market has been under even more pressure since Russia began its invasion of Ukraine in late February. Disruptions to shipments and the overall uncertainty has caused the price of fuel to skyrocket in recent months.
The worst of ticket price hikes could be yet to come. In March, Cowen & Co. airline analyst Helane Becker told clients to expect a roughly four-month lag before airline ticket prices reflected higher jet fuel costs.
“As a result, it is likely the next few months will be financially concerning, even though traffic is strong,” Becker said at the time, according to CNBC.
While the price of a plane ticket has surged, steep gasoline costs have offered little relief to travelers who opt to drive to their destinations. The national average price of a gallon of gas hit an all-time high of $4.60 on Thursday, up by more than a buck and a half compared to the same day one year ago.