United Airlines will reduce more flights due to the expected oil prices to be above $100 per barrel until 2027.
United Airlines will cut more loss-making flights in the next two quarters to cope with the long-term situation of high oil prices caused by the Iran conflict, despite strong travel demand allowing US airlines to increase ticket prices. CEO Scott Kirby said in a memo to employees that the company is preparing for oil prices to rise to $175 per barrel and remain above $100 by the end of 2027. He stated that if oil prices remain at that level, United's annual fuel costs will increase by about $11 billion, more than double the profit the company made in its "best year ever." The Iran conflict has put airlines in the face of a new round of fuel shocks. Since late February, aviation fuel prices have nearly doubled, not only raising costs across the industry but also disrupting global flight operations due to route adjustments and airspace restrictions. "The situation may not be so bad," Kirby wrote in reference to the airline's fuel forecast. "But... being prepared for this outcome is not harmful to us." United Airlines has already started cutting flights with lower profitability, including some midweek, Saturday, and overnight flights.
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