The drop in oil prices has a direct effect on the long and short term financial outlook for airlines. The difference between buying jet fuel when crude oil is $147 a barrel versus $100 a barrel is $15 billion a year. Airline analyst Gary Chase at Lehman Brothers estimates that even with a recession, the U.S. industry can break even with oil prices in a range of $100 to $105 a barrel.
In addition to these fees, airlines have cut many flights which will cut their expenses and drive up the price of tickets. Some relief from the high cost of flying must come or the U.S. consumer will start exploring cheaper transportation options, which will surely cause many airlines to go out of business.
In addition to these fees, airlines have cut many flights which will cut their expenses and drive up the price of tickets. Some relief from the high cost of flying must come or the U.S. consumer will start exploring cheaper transportation options, which will surely cause many airlines to go out of business.
No comments:
Post a Comment