United Airlines CEO Scott Kirby recently revealed that passengers can expect a rise of 15% to 20% in ticket prices in the wake of the US-Israel and Iran conflict. This step is taken to tackle the fuel prices, which have seen an increase as the conflict escalates, in turn increasing oil prices. This piece of news comes amid Donald Trump having agreed to extend the two-week ceasefire deal with Iran. However, he has received no official response from Tehran yet.
United Airlines might increase airfare amid Iran war
Scott Kirby said on Wednesday that there are chances that airfares might increase amid the ongoing conflict. The airline aims to pass the higher costs on to passengers as early as possible to cover fuel expenses, as it aims for double-digit pre-tax margins next year. The prices could be expected to go up by 15% to 20%. This is because the company wants to cover the whole fuel expense through this move.
This call comes after the airline company forecast that the second-quarter and full-year profits may see a drop from what Wall Street had forecast. Although the premium travel demand is strong, the increasing fuel prices are seemingly pressuring the margins and are displaying a weak short-term outlook. This conclusion was drawn by the company based on the Gulf Coast jet fuel price as of April 17. But they are certain that the changes could happen, depending on what direction the fuel prices take (via Reuters)
After Trump’s 48-hour deadline ended, Pakistan mediated the talks between both parties. Both agreed to a two-week ceasefire deal, which has already ended. On April 11, senior US and Iranian officials met in Pakistan for negotiations, but their talks stalled, reaching no final deal.
After that, Trump blocked the Strait of Hormuz. Following a temporary ceasefire deal between Israel and Lebanon, Iran briefly opened the Strait only to close it later. It warned that it will reopen it once the US removes the blockade. To keep the negotiations going, Trump has extended the ceasefire for an unspecified time.
Originally reported by Shazmeen Navrange on Mandatory.
