United Airlines CEO says fuel prices will hit first-quarter results

United Airlines CEO Scott Kirby said the recent surge in jet fuel prices following military strikes involving the United States, Israel, and Iran could have a meaningful impact on the airline’s financial performance this quarter. Despite the sharp increase in fuel costs, he emphasized that travel demand has remained strong.

Fuel is one of the largest expenses for airlines, second only to labor. According to the Argus U.S. Jet Fuel Index, jet fuel prices have jumped significantly, rising about 58% since last Friday and reaching roughly $3.95 per gallon by Thursday.

Kirby explained that if the higher fuel prices continue, the effects could extend into the next quarter as well.

He made the remarks after speaking at an event at Harvard’s John A. Paulson School of Engineering and Applied Sciences, where he discussed trends shaping the future of air travel.

Like most major U.S. airlines, United does not hedge fuel prices. Fuel hedging is a strategy companies sometimes use to lock in prices through financial contracts to protect against volatility. However, Kirby said the practice has largely faded within the airline industry.

He added that even when companies attempt to hedge fuel costs, managing the “crack spread”—the difference between crude oil prices and refined fuel products—can be extremely difficult.

If higher fuel costs persist, travelers could see the effects reflected in airfare sooner rather than later. Kirby suggested that ticket prices may begin adjusting relatively quickly if the current fuel trends continue.

Even with the rising costs, United Airlines is still experiencing strong travel demand. Kirby said booked revenue is currently about 20% higher compared with the same period last year.

According to him, demand for travel has remained steady and has not shown signs of slowing despite the geopolitical tensions.

The comments come just weeks before airline leaders are scheduled to attend a closely watched JPMorgan industry conference, where executives often update investors on financial outlooks and industry trends.

Meanwhile, the conflict in the Middle East has already disrupted global air travel. More than 25,000 flights have been canceled since the attacks began, leaving over a million passengers stranded and forcing airlines to adjust routes and operations.

Major aviation hubs in the region, including Dubai International Airport in the United Arab Emirates and Hamad International Airport in Doha, Qatar, serve as key connections for millions of travelers flying between Europe, Asia, Australia, and North America.

However, widespread airspace closures have forced airlines and passengers to avoid parts of the Middle East, reshaping travel routes and booking patterns.

Kirby said United has seen a surprising shift in demand as a result. The airline has recently booked more than 1,000 passengers per day traveling from Australia and New Zealand to Europe—routes that previously saw almost no bookings. Last year, he said, those routes averaged fewer than one passenger per day.

He added that Europe is currently the airline’s strongest region for bookings.

United is also in discussions with the U.S. government about the possibility of operating charter flights to help evacuate American citizens from the Middle East. Kirby noted that these plans are still under consideration and have not yet been finalized.

The situation highlights how quickly geopolitical events can influence global aviation. Airlines are now balancing strong passenger demand with rising fuel costs and operational challenges as the conflict continues to affect international travel routes.