The military conflict involving Iran that began on February 28, 2026, led to the long-term closure of the Strait of Hormuz, blocking about 20% of the world's oil supply and sending jet fuel prices soaring from around $100 to over $230 per barrel [1, 2]. The sharp increase in fuel costs forced airlines to raise ticket prices, add fees, and trim unprofitable routes [1, 2].
Global refinery output rose as US, European, Indian, and Nigerian facilities boosted jet fuel production to partly offset the loss of Middle Eastern supply [1]. This rapid supply adjustment prevented the expected severe jet fuel shortage from materializing during summer 2026, though some industry observers still warn of looming pressure on fuel availability [1, 2].
Airlines report a 0.5% drop in global flight numbers compared to last year, reversing a prior 2% growth trend [1]. The Iran war and resulting fuel price shock contributed directly to the May 2026 shutdown of low-cost carrier Spirit Airlines, which in turn caused flight cancellations and broader ticket price increases across the industry [2].
Analysts estimate the conflict has so far cost the airline sector about $15 billion [2]. Airlines now focus more on managing profitability and declining demand than fuel supply risks, although Eastern and Southeast Asian carriers forecast double-digit passenger drops in the months ahead due to sustained high energy prices and inflationary pressures [1].
Even if the conflict ends and fuel prices stabilize, airlines may not reduce ticket prices to previous levels, reflecting a durable shift in operating costs [2].
