Jet Fuel Prices On The Rise

by BWK ~ April 14, 2008

NY Times reports that ATA Airlines has filed for bankruptcy protection and cancelled all flights. The airline has had troubles over the past several years, but the recent and rapid rise in fuel costs appear to have pushed the struggling carrier over the edge.

Other airlines are also struggling to keep up with fuel costs. Most airlines are adding fuel surcharges to each ticket, and charging more for baggage while reducing in-flight amenities. And this is occurring as the US airliner fleet is showing its advanced age, because few airlines have bought new airplanes in the past decade or so. Older aircraft tend to be les fuel efficient, and require more maintenance.

Several airlines have recently encountered widespread system delays because of the need to ground entire classes of aircraft for inspections. Southwest has had issues with its fleet of Boeing 737s. American and Delta have had to ground and inspect large numbers of MD-80s. And United recently grounded almost all of its Boeing 777s for inspections. These groundings were sudden, to the point of precipitate, and inconvenienced hundreds of thousands of travelers, while tying up both the US and international flight schedule for days at a time.

And the peak summer travel season has not even started.

BWK

Note: Byron King is a frequent contributor to the free e-letter Whiskey & Gunpowder. To receive daily insights into energy, oil, commodities and other natural resources sign up here!

Additional Resources:
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