But at the moment, airline tickets are a hot commodity no matter what the cost.
In a press conference in London regarding their ongoing partnership, Delta Air Lines CEO Ed Bastian and Virgin Atlantic CEO Shai Weiss both said demand is robust.
Bastian said that they really haven’t seen any impact at all, in terms of reluctance to travel from U.S. travellers coming to Europe.
He also said he was not yet to the “point of nervousness” about rising oil prices.
Not only is he not nervous, Bastian said this was the strongest demand he has seen in his career due to pent-up demand and a willingness from consumers to pay a higher fare to fly and for some, to fly for the first time in two years.
And it’s not just anecdotal evidence on Bastian’s part, as new data suggests flights are back to pre-pandemic levels.
But the fly in the ointment could be the ongoing Russian invasion of Ukraine and the up-and-down nature of the price of oil, which is converted into jet fuel, which is the second-biggest expense for airlines after employee compensation.
Scott Keyes, founder of the aviation site Scott’s Cheap Flights, noted that just a year ago oil was $60 a barrel. On some days right now, it’s double that.
For the moment, Keyes noted that flight prices are not jumping significantly yet since most airlines purchase fuel weeks, even months, in advance.
If the current price spike is a blip and comes back down in not too long, then it won’t have had a major impact, Keyes said.
If the price of oil spikes and stays high for months, though, some portion of that will certainly be passed on to travellers in the form of higher ticket prices.
Tags: Delta Air Lines, Virgin Atlantic
