Tuesday, March 10th, 2026
Welcome to Quests Daily | Your Compass for the Day in Travel.
The Lead Story:
A New Fuel Shock Is Building for Airlines
Crude oil prices have surged roughly 50% since the U.S. and Israel launched joint strikes on Iran on February 28, with Brent hitting $119.50 before settling near $106, the first time oil crossed $100 since Russia's 2022 invasion of Ukraine. Jet fuel has moved faster still. When Iranian strikes hit Gulf refineries, the cost of converting crude into aviation fuel spiked independently, a second layer of pressure on top of crude price gains. By Thursday, jet fuel reached $3.95 a gallon, up from $2.50 before the strikes. United Airlines CEO Scott Kirby warned the impact on ticket prices will "probably start quick."
This is not a temporary oil spike. Analysts say the industry’s fundamentals are stronger than during the Russia-Ukraine crisis, but the risks are also bigger. Airlines without fuel hedges are the most exposed. Rerouting alone is adding 90–120 minutes to long-haul flights, pushing costs up well beyond fuel. That can quickly turn into a distribution problem. If fuel prices stay this high, leisure demand will soften and airlines may start renegotiating group contracts within the quarter. Fuel may start as an airline cost issue, but it soon becomes an industry revenue problem.
The Briefing:
Rerouted international flights are burning about 12% more fuel per leg as airlines take longer “safe-corridor” routes to avoid Middle East conflict zones, increasing costs and flight times. source.
Indian airline stocks, including IndiGo, fell sharply as the Iran war pushed crude oil prices higher, raising concerns about soaring fuel costs and pressure on airline profitability. source.
European airline stocks fell as surging oil prices raised concerns over higher jet fuel costs, increasing pressure on airline profit margins amid escalating Middle East tensions. source.
Term of the Day: Fuel Hedging
A contractual strategy where airlines pre-purchase jet fuel at a fixed price to protect against future market spikes.
Used when: Explaining why some carriers (hedged) are maintaining stable fares while others (unhedged) are raising prices daily during the current crisis.
Visual- Stat of the Day
Takeaway: Hedging is the only thing separating stable airlines from ones in triage mode right now. Carriers like Lufthansa that locked in fuel prices before the conflict have 12 or more months of breathing room. Unhedged carriers like American, United, Air India, and SpiceJet are absorbing the full force of a 55% fuel spike with no buffer.
Leader’s Quote
Airlines rarely absorb shocks of this nature for long. They manage them and then they pass them through.
~ Linus Bauer, Founder, BAA & Partners
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