Meanwhile in the US, the major North American airlines have calmed market fears at the JPMorgan Industrials Conference in Washington DC this week, where airline executives struck a broadly optimistic tone, saying demand remains strong despite the recent surge in jet fuel prices triggered by the Middle East conflict.
Across presentations from Delta Air Lines, United Airlines, American Airlines, Southwest Airlines, JetBlue Airways, Alaska Air Group, Frontier Airlines, and Air Canada, management teams consistently highlighted resilient forward bookings and improving pricing trends.
Executives said the industry has so far been able to push through fare increases to offset rising fuel costs. Several airlines reported double-digit revenue growth expectations in the coming months, supported by strong corporate, international and leisure demand.
United said booked yields had risen between 15% and 20% in recent weeks, while American expects unit revenue growth of more than 10% in March. Delta similarly reported sales up sharply year-on-year across all major customer segments.
Air Canada said it had already implemented price increases and continued to see strong demand, noting that fuel typically accounts for roughly 20%–25% of its cost base.
The conference commentary suggests the industry is proving more resilient to energy price shocks than in previous cycles. Airline executives attributed this to stronger balance sheets, improved capacity discipline and diversified revenue streams.
Premium travel and corporate demand remain key drivers of profitability. Air Canada said premium products now account for roughly 28%–29% of revenue, with potential for further growth, while several airlines highlighted the continued strength of international travel.
Loyalty programmes were also repeatedly cited as an increasingly important source of revenue and cash flow. Airlines including Air Canada and Alaska highlighted the growth of their loyalty ecosystems and the value of co-branded credit-card partnerships in supporting margins.
At the same time, airlines emphasised disciplined capacity growth, with several carriers indicating they would adjust capacity if fuel prices remain elevated.
Analysts at TD Cowen said the current fuel shock could accelerate the “gentrification” of the airline industry, favouring carriers with strong brands, premium products and loyalty programmes.
While executives acknowledged that higher energy costs remain a risk, the overall tone from the conference suggested that strong demand and pricing power are helping airlines offset much of the pressure.
For now, the industry appears to be navigating the latest fuel shock better than many investors had feared.
North American airline executives calm worst fears
