After attacking Iran, U.S. oil prices just saw one of their largest single-week increases in history, with domestic benchmarks rising above $90 for the first time since 2023.
It happened so quickly that the fallout is still being digested worldwide. For now, that processing has been mostly done by global economies, stock markets, and investors.
But soon, everyday Americans will start feeling the impacts too.
This week, gas prices surged to their highest level in 11 months this week after the U.S. attacked Iran, rising 27 cents a gallon on average.
But you won’t just be feeling it at the pump. Jet fuel costs are also taking off, threatening summer and holiday plans — or, at a minimum, making them more expensive.
Related: It’s not just rising oil prices you’ll have to worry about if Iran conflict continues
Rising airfares put summer plans on the rocks
With no end in sight for the Iran conflict, higher jet fuel costs are coming for airlines. You might feel it in your airfares, too.
Jet fuel is a significant cost for airlines, exceeding one-third of their total operating costs. And when these prices rise, they generally pass the higher costs along to the customer.
United Airlines CEO Scott Kirby even sounded the alarm at an event on Thursday, cautioning that the impact of higher oil prices could harm the business. He also added that the impact to passenger ticket costs will “probably start quick.”
Related: United Airlines CEO issues stark warning about ticket prices
From a review of several popular domestic routes, there are signs the uptick has already begun. Data from Google Flights shows that the average price of airfares has already jumped on a number of popular domestic routes.
Investors moved first
Recognizing the rising uncertainty, investors have been positioning accordingly. Even before airlines began raising prices, investors were re-pricing the airlines.
This week, the U.S. Global Jets ETF ($JETS) fell over 10%. Big airlines like Delta, United, American, and Southwest fell 6.23%, 7.8%, 9.11%, and 13.36%, respectively. Alaska Airlines fell 15.3%, owing to higher oil prices out west (which has been a headache for them in the past, too).
Budget airlines have also been hammered, such as JetBlue, Allegiant, and Frontier. They’re off nearly 20%, doing the worst of the airline crop.
But investor reactions aside, the practical implication is that airfares will have to rise. This will help cover some of the rising fuel costs, but it might not make up for a decline in travelers if airfares become out of reach for many Americans.
If the past is any indication, airfares will likely revert back toward mean levels as jet fuel costs decline. That would first require oil prices to decline, which would require less tenuous conditions in the Middle East.
However, data from the Bureau of Labor Statistics (BLS) says that airfares were up just 6% in January 2026 from pre-COVID-19 pandemic prices. In other words, prices fell in those six years, accounting for inflation. They would likely stand to do so after this shock passes.
What should you do?
If you have travel plans, you could wait out the recent price spike and hope that prices decline after the initial shock. However, that might not be a great strategy, particularly if the conflict remains ongoing for many weeks or months.
Instead, you might consider locking in prices today by booking an economy-class ticket or a refundable fare. In the event a flight price goes down, you could always cancel and rebook at a lower rate, keeping either a credit (nonrefundable) or getting a refund of your original fare (refundable).
You could also take a look at your airline miles balance. Frequent flyers or people who spend on certain credit cards by Amex, Chase, or Capital One might unknowingly have points to spend. The rates on airline award travel are often different than the cash rates. Award travel is also generally fully refundable (although there are exceptions).
Alternatively, you might consider deferring unnecessary travel for now. That’s unlikely to sound great to those planning for the coming summer months, but if today’s prices look awful, consider that there could be even worse to come.
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