INDIANAPOLIS— The cost of flying could soon go up as rising oil prices put pressure on airlines.
Conflict in the Middle East has driven oil prices higher and consumers have already seen the effect at the gas pump. Experts say the impact may soon reach airline ticket prices
“Fasten your seat belts. It’s going to be a bumpy ride if oil prices stay high,” said travel expert Clint Henderson of The Points Guy.
Henderson said travelers who are planning trips later this year may want to book sooner rather than later. Normally, he advises booking flights one to two months ahead of travel, but the current situation could change that strategy.
“We’re advising consumers to go ahead and book travel for the year if they can,” Henderson said. “Especially lock in those holiday flights if they’re at all able to.”
Airlines are already feeling the impact of higher fuel costs.
“Airlines don’t have a lot of margin,” said Kyle Anderson an economist with the IU Kelley School of Business. “When we think about airlines as doing well, really they don’t have margin to absorb huge cost shocks without passing those on to consumers. I think we’re going to see prices going up pretty quickly.”
Anderson said the situation is similar to previous spikes in oil prices, but this time the shift has happened more suddenly.
“Part of this is the inability for tanker ships to transport,” Anderson said. “We don’t know what’s going to happen, and markets don’t like uncertainty. That’s why you see prices going up.”
The big question is how much airfare could increase.
“It’s going to depend on the market,” said Henderson. “But I think up to $100 for a domestic ticket is not outside the realm of possibility.”
Henderson says there are still ways passengers can try to keep ticket prices down. Start by comparing flights through tools such as Google Flights and setting price alerts. If you have been saving airline miles or credit card points, this may also be a good time to use them.
“When fares are highest, you’ll get the most value for those points,” Henderson said.
