Vertiv Introduces New Single-Phase Uninterruptible Power Supply for Distributed Information Technology (IT) Networks and Edge Computing Applications in Europe, Middle East, and Africa (EMEA)Read more Students from JA Zimbabwe Win 2023 De La Vega Global Entrepreneurship AwardRead more Top International Prospects to Travel to Salt Lake City for Seventh Annual Basketball Without Borders Global CampRead more Rise of the Robots as Saudi Arabia Underscores Global Data and Artificial Intelligence (AI) Aspirations with DeepFest Debut at LEAP23Read more Somalia: ‘I sold the last three goats, they were likely to die’Read more Merck Foundation and African First Ladies marking World Cancer Day 2023 through 110 scholarships of Oncology Fellowships in 25 countriesRead more Supporting women leaders and aspirants to unleash their potentialRead more Fake medicines kill almost 500,000 sub-Saharan Africans a year: United Nations Office on Drugs and Crime (UNODC) reportRead more Climate crisis and migration: Greta Thunberg supports International Organization for Migration (IOM) over ‘life and death’ issueRead more United Nations (UN) Convenes Lake Chad Countries, Amid Growing Regional CrisisRead more

US airlines see strong travel recovery after Omicron

show caption
US airlines are seeing a recovery in reservations after the latest Covid-19 wave, offsetting a hit from higher jet fuel costs./AFP
Print Friendly and PDF

Mar 16, 2022 - 09:57 AM

NEW YORK — Major US carriers lifted their revenue forecasts Tuesday as a faster-than-expected travel recovery from the latest Covid-19 wave mitigates the drag from higher jet fuel costs.

American Airlines, Delta Air Lines, United Airlines and Southwest Airlines all offered similar appraisals of market conditions in presentations at an investment conference Tuesday.

American now expects first-quarter revenues to be down 17 percent compared with the 2019 period, after previously projecting a drop of as much as 22 percent.

“The improvement in revenue is expected to more than offset the increases in fuel and other expenses in the quarter,” American said in a securities filing.

Delta Air Lines reported “strong spring and summer travel demand” as it lifted its revenue forecast for the first quarter of 2022.

Southwest Airlines used similar language to describe booking trends, while United Airlines said that “in the period following the peak in Covid-19 case counts associated with the Omicron variant in January 2022, demand for travel has exceeded the company’s previous expectations.”

But higher jet fuel costs in light of spiking crude prices act as a counterweight to the improved travel outlook.

Delta now projects fuel prices of $2.80 a gallon, up from its prior range of $2.35 to $2.50. American and United also warned of a hit from fuel.

Rising fuel costs, along with aircraft delivery delays, were a factor in United’s move to trim its overall flight capacity in 2022.

Southwest proved an exception since the carrier’s hedging program locked in fuel costs when prices were lower. As of March 10, the program amounted to an asset of $883 million based on current prices for the commodity.

But Southwest also trimmed its flight schedule for the March to May period, citing “continuing challenges with available staffing.”

Shares of airlines were sharply higher early Tuesday, with all four carriers up at least 5.6 percent.

MAORANDCITIES.COM uses both Facebook and Disqus comment systems to make it easier for you to contribute. We encourage all readers to share their views on our articles and blog posts. All comments should be relevant to the topic. By posting, you agree to our Privacy Policy. We are committed to maintaining a lively but civil forum for discussion, so we ask you to avoid personal attacks, name-calling, foul language or other inappropriate behavior. Please keep your comments relevant and respectful. By leaving the ‘Post to Facebook’ box selected – when using Facebook comment system – your comment will be published to your Facebook profile in addition to the space below. If you encounter a comment that is abusive, click the “X” in the upper right corner of the Facebook comment box to report spam or abuse. You can also email us.