Gas prices continue to hamper travel
Travelers first began feeling the gas-price pinch in late February when unrest in the Middle East sent prices soaring. The situation has only gotten worse.
Oil prices are hovering around $110 a barrel, resulting in $4 a gallon and higher at the gas pump in many U.S. cities. After posting sizable profits in 2010, airlines are struggling this year. Delta Air Lines reported a $318 million loss in the first quarter, and United blamed a 41 percent increase in fuel prices compared to this time last year for its $213 million loss. Combined, the five largest airlines in the United States reported losses of more than $1 billion. Discount carrier Southwest Airlines was the only airline to post a profit in the first quarter.
Rising fuel prices for airlines are expected to push up travel costs for customers, both in the form of airline fare and additional service fees. Delta and US Airways are planning to increase flight fares, according to Reuters. Delta Chief Executive Richard Anderson said, “We must fully recapture our costs on every flight every day to maintain and improve our earnings performance.” Other airlines are canceling flights altogether. For example, AirTran Airways’ direct flight from Des Moines, Iowa, to Orlando ends May 3.
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