American Airlines Warns of Fare Increases If Oil Remains High

Oil up 50%

Image Credits: Wikimedia Commons.

American Airlines warned airline passengers may eventually face higher ticket prices if oil prices remain high, prompting carriers to remove seats from the market.

Oil prices have risen around 50 percent compared to the levels seen last year and that is putting pressure on airline profits.

“If it becomes clear this is the new normal you would see over time less capacity and growth in the industry and therefore higher prices, but I don’t think that’s going to happen in the near term,” CEO Doug Parker told reporters on the sidelines of the annual IATA meeting of airline executives in Sydney.

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