Airlines Cut Flights Amid Soaring Jet Fuel Prices
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy UAL?
Source: Newsfilter
- Flight Reductions: Airlines are cutting flights, particularly international routes, in response to soaring jet fuel prices that have nearly doubled since the U.S. and Israel's attack on Iran on February 28, which is expected to impact summer travel demand.
- Fuel Cost Surge: Jet fuel prices in the U.S. have risen from $2.50 per gallon on February 27 to $4.88 by April 2, forcing airlines to raise fares and additional fees to offset increased fuel costs, further affecting passenger willingness to travel.
- Demand and Supply Challenges: While airlines report strong travel demand, high fuel prices and supply shortages may lead to further capacity cuts in the coming weeks, particularly on the U.S. West Coast where refining capacity is limited, making fuel prices more volatile.
- Uncertain Industry Outlook: Analysts warn that if high oil prices persist, there could be pressure on airline ratings, especially if consumer spending is affected by other economic factors, prompting airlines to closely monitor market dynamics.
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Analyst Views on UAL
Wall Street analysts forecast UAL stock price to rise
16 Analyst Rating
15 Buy
1 Hold
0 Sell
Strong Buy
Current: 97.670
Low
115.00
Averages
139.07
High
156.00
Current: 97.670
Low
115.00
Averages
139.07
High
156.00
About UAL
United Airlines Holdings, Inc. is a holding company. The Company transports people and cargo throughout North America and to destinations in Asia, Europe, Africa, the Pacific, the Middle East and Latin America. The Company, through United Airlines, Inc., and its regional carriers, operates across over six continents, with hubs at Chicago O'Hare International Airport (ORD), Denver International Airport (DEN), George Bush Intercontinental Airport (IAH), Los Angeles International Airport (LAX), Newark Liberty International Airport (EWR), San Francisco International Airport (SFO), Washington Dulles International Airport (IAD) and A.B. Won Pat International Airport (GUM). Its hub and spoke system allow it to transport passengers between a large number of destinations with frequent services. The Company has contractual relationships with various regional carriers to provide regional aircraft service branded as United Express. It provides freight and mail transportation services (Air Cargo).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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