United Airlines cuts flights amid rising fuel costs and Middle East tensions

WASHINGTON : United Airlines has announced plans to cut additional flights over the next two quarters as it braces for a sustained rise in fuel prices, driven by geopolitical tensions linked to the Iran conflict. Chief Executive Scott Kirby, in a memo to staff, warned that oil prices could climb as high as $175 per barrel and remain above $100 through 2027, a scenario that could push the airline’s annual fuel bill up by $11 billion, more than double its highest yearly profit to date.

The surge in jet fuel prices, which have nearly doubled since late February, has created a fresh cost shock across the aviation industry. Airlines are also facing operational disruptions due to rerouted flights and restricted airspace in affected regions.

In response, United has already begun trimming less profitable services, particularly midweek, Saturday, and overnight flights. The airline now plans to cut around three percentage points of off-peak flying during the second and third quarters, focusing on routes with weaker demand. Additionally, it will reduce capacity at Chicago O’Hare by about one percentage point and continue suspending flights to Tel Aviv and Dubai. Overall, these measures will reduce United’s planned capacity for the year by approximately five percentage points.

Despite these cuts, the airline expects to restore its full schedule by the fall. Kirby emphasized that United would rather leave some demand unmet than operate loss-making routes in a high-fuel-cost environment.

Across the industry, strong travel demand has enabled airlines to offset rising costs by increasing ticket prices. U.S. carriers have already implemented fare hikes and may push prices up further by 5% to 7%. United itself reported a 15% to 20% rise in fares booked over the past week, reflecting robust demand.

Rival carriers, including Delta Air Lines, have also indicated flexibility to reduce capacity if fuel prices remain elevated. However, U.S. airlines remain particularly vulnerable to fuel price spikes, as most do not hedge fuel costs, unlike many European and Asian counterparts.

The pressure is especially intense on low-cost carriers, which are already grappling with rising labor expenses. Nevertheless, airline executives remain optimistic about sustained demand, with United reporting its strongest booking weeks in history during the first 10 weeks of the year.

Looking ahead, United has reaffirmed its long-term growth strategy. The airline plans to take delivery of around 120 new aircraft this year, including 20 Boeing 787s, with an additional 130 aircraft expected by April 2028. Kirby also reassured employees that, unlike previous downturns, the company does not plan to implement furloughs or delay future investments.