Airlines slash flights amid rising fuel, oil prices

Alaska Airlines expects capacity to drop between 3% and 5%

The rising cost of jet fuel is becoming the latest woe for the airline industry.

Some carriers are being forced to trim their flight schedules due to the uptick in fuel prices, driven by the increase in oil prices. 

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People check in at Alaska Airlines ticketing kiosks at Seattle-Tacoma International Airport before the Thanksgiving holiday in Seattle, Washington, U.S.  (Reuters/Lindsey Wasson / Reuters)

Spot prices for Gulf Coast jet fuel have doubled in the past 14 months and risen one-third just since the start of this year. Since fuel can amount to one-third of an airline’s costs, it’s a big item.

Alaska Airlines said in a regulatory filing Tuesday that fuel prices have been volatile "as a result of the conflict in Europe and Russia's ongoing invasion of Ukraine." 

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The carrier estimated that fuel will cost between $2.60 to $2.65 per gallon for the first quarter, surpassing its earlier projection of $2.45 to $2.50 per gallon.

As a result of the "sharp rise," the carrier said it "slightly moderated our capacity outlook for the year." Alaska expects to cut down on its flights between 3% and 5% in the first half of 2022.

Travelers walk through in Salt Lake City International Airport, Tuesday, March 9, 2021, in Salt Lake City.  (AP Photo/Rick Bowmer / AP Newsroom)

"We continue to plan for a return to 100% of pre-COVID capacity by summer followed by growth in the second half of the year, and will continue to prudently adjust capacity as necessary in response to the evolving fuel environment," the company said in the filing.  

Ticker Security Last Change Change %
ALGT ALLEGIANT TRAVEL CO. 123.49 +6.19 +5.28%
ALK ALASKA AIR GROUP INC. 41.92 +2.00 +5.01%

According to Bloomberg, ultra-low-cost carrier Allegiant Airlines plans to do something similar. 

Chief Financial Officer Greg Anderson said at a conference Monday that it was seeking to cut its capacity between 5% and 10%, the outlet reported. However, the carrier will try and do so during times of lower demand. 

Allegiant Airlines did not immediately respond to FOX Business' request for comment. 

The Associated Press contributed to this report.