Jet Fuel Prices SOAR As Global Supply Chain At Brink of Collapse

Written By BlabberBuzz | Friday, 22 October 2021 21:45

Air fares are expected to soar just in time for the holiday season, as jet fuel prices skyrocket back to pre-pandemic levels, the United Airlines CEO warned on Wednesday.

Jet fuel prices are already up more than 100 percent compared to just one year ago, CNBC reports, with the price per gallon set at $2.3282 as of Tuesday.

But Scott Kirby, the CEO of United Airlines, warned that the prices may go up even further. He forecasted an average fuel cost of $2.39 a gallon in the fourth quarter of the year, as United expects a surge in bookings for the holiday season.

'You know, I think in the longer term, it's always been the case at an airline that jet fuel prices go up, usually because demand is strong - and that's going to be true again,' Kirby told the hosts of CNBC's Squawk on the Street on Wednesday.

 WATCH: IRAN CLOSING IN ON NUCLEAR WARHEADSbell_image

 WATCH: IRAN CLOSING IN ON NUCLEAR WARHEADSbell_image

'Higher jet fuel prices lead to higher ticket prices,' he said. 'Ultimately, we'll pass that through.'

United was able to post a $473 million profit for the third quarter, which ended at the end of September, thanks to the $1.1 billion it received in federal aid.

Company executives note that they expect its 2022 costs - excluding the price of fuel - to be lower than 2019 before the government instituted pandemic-related travel restrictions.

 MILITARY IN MICHIGAN FIGHTING VIRUS SURGEbell_image

 MILITARY IN MICHIGAN FIGHTING VIRUS SURGEbell_image

In the interview, Kirby went on to warn that the federal government's vaccine mandate could pose a risk to some of its rivals, which may force the airlines to cancel some flights amid a worker shortage.

 CHUCK SCHUMER MOURNS THE DEATH OF FATHERbell_image

 CHUCK SCHUMER MOURNS THE DEATH OF FATHERbell_image

American - the United States' largest airline - and JetBlue have both set November 24 deadlines, sparking fears of mass cancellations if both are forced to fire workers who haven't had a shot on Thanksgiving Eve.

Kirby pointed out that more than 96 percent of its company's staff is already vaccinated, as United imposed its mandate in August, with an October deadline, which put employees at risk of losing their job if they did not receive a shot or achieve an exemption.

 HOLIDAY GIFTS STRUCK BY BIDENFLATIONbell_image

 HOLIDAY GIFTS STRUCK BY BIDENFLATIONbell_image

The mandate came one full month before President Joe Biden mandated that all federal contractors - including airline employees - be vaccinated by December 8.

 FREEDOM LOST: HHS ROLLS BACK TRUMP'S RELIGIOUS EXEMPTION FOR MANDATESbell_image

 FREEDOM LOST: HHS ROLLS BACK TRUMP'S RELIGIOUS EXEMPTION FOR MANDATESbell_image

'Customers can book with confidence on United,' Kirby insisted. 'But if you're booking on an airline that doesn't have a vaccine requirement, they've got government rules they have to follow.'

This week, American Airlines and Southwest Airlines said they would not put staff members on unpaid leave if they are applying for or have received medical or religious exemptions to the vaccine - unlike United, which said employees with exemptions would be put on unpaid leave.

The airline has been temporarily blocked from doing so amid a lawsuit from staff members over the practice.

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