Airlines cut flights as rising fuel costs threaten higher holiday fares

Millions of Americans making holiday travel plans could face fewer flight options and higher fares as major U.S. airlines scale back some of their schedules.

(NBC)- Millions of Americans making holiday travel plans could face fewer flight options and higher fares as major U.S. airlines scale back some of their schedules.

American Airlines, United Airlines and Southwest Airlines are reassessing less-profitable flights as elevated jet fuel prices increase operating costs. United has already cut some planned December flights, while American said the latest fuel increase could add about $1 billion to its fourth-quarter expenses. Southwest has also reduced its planned capacity growth.

Katy Nastro, a travel analyst at Going, said higher operating costs give airlines less incentive to offer deep discounts as demand remains strong.

The pressure comes as the war with Iran continues to affect global energy markets. President Donald Trump said Sept. 9 that he expects oil prices to fall after the November midterm elections, saying, “Right after the election, oil prices are going to be tumbling downward.”

Higher energy costs are also affecting drivers and businesses. The national average for gasoline remains above $4 a gallon, while diesel prices have climbed sharply. Rising diesel costs can increase expenses for trucking, agriculture and other industries that depend heavily on fuel.

For air travelers, reduced airline capacity could mean fewer choices during the busy holiday season. Airlines have said travel demand remains strong even as fares rise, allowing carriers to offset some of their higher fuel expenses.

Nastro recommends travelers who have not booked their holiday flights avoid waiting much longer, particularly if their travel dates are not flexible.

Travelers may still find savings by considering less-popular travel days or alternate airports. But with airlines trimming some flights and fuel costs remaining elevated, holiday travelers could continue to face higher prices and more limited options.