Fuel Costs for Airlines in 2026
The global aviation industry is bracing for an additional $100 billion in fuel expenses in 2026, driven by a sharp increase in oil prices following the conflict in Iran. According to data from the International Air Transport Association (IATA), average jet fuel prices in 2026 are projected to be roughly 70% higher than in 2025. This surge is expected to slash carrier profits from $43 billion in 2025 to just $23 billion in 2026.
The Middle East crisis, which erupted in March, triggered a dramatic rise in oil prices, directly impacting the cost of aviation fuel. IATA Director General Willie Walsh commented:
“When war broke out in the Middle East in March, oil prices climbed and the cost of jet fuel skyrocketed. As a result, we expect average jet fuel prices to be 70% higher year-on-year, adding $100 billion to our total fuel costs this year.” — Willie Walsh
Demand for jet fuel remains steady, with 86% of passengers anticipating that ticket prices will adjust in line with oil costs. Nearly half of surveyed travelers expect to spend more on trips this year. However, supply chain disruptions already cost airlines $11 billion in 2025, and reports from June 8 indicate that rising fuel prices could lead to widespread flight cancellations and increase the risk of bankruptcies across the sector.
Outlook and Challenges
The aircraft order backlog has exceeded 18,000 units, signaling potential growth opportunities for the industry, but current economic pressures may significantly worsen conditions. The war with Iran has already left its mark on global civil aviation, and its repercussions are likely to continue affecting the airline sector for years to come.
The spike in fuel costs, fueled by geopolitical conflicts, will heavily impact airlines' financial performance, potentially forcing shifts in business strategies. While demand for air travel remains robust, financial strain may push carriers to raise ticket prices, which in turn could affect consumer spending and travel volumes. As a result, the aviation industry’s situation will remain under close scrutiny from experts and analysts monitoring how global events shape the market.