Although, crude has recovered from the 12-year low of around $26 per barrel it slipped to this February, it is nowhere near the above $100 a barrel mark witnessed in mid-2014. Soft oil prices are being cited as one of the main reasons for declining airfares. According to Hopper, jet fuel had declined in August to around $1.25 per gallon. Apart from cheap oil, capacity overexpansion is being viewed as another major reason for falling
To read more about net flights visit flights googleairfares. August traffic reports of major carriers like Southwest Airlines LUV, American Airlines Group AAL, United Continental Holdings UAL and Alaska Air Group, Inc. ALK revealed a fall in load factor (percent of seats filled with passengers) as capacity expansion outweighed traffic growth. Airline behemoth, Delta Air Lines DAL too witnessed a decline in load factor as capacity expanded while traffic contracted. TRANSPORTATION-AIRLINE Industry Price Index TRANSPORTATION-AIRLINE Industry Price Index Unit Revenue Woes Remain While low air fares are favorable for fliers, it is likely to hurt the top line of airline companies, thereby resulting in lesser profits. Low oil prices, declining airfares and the constant fall in unit revenues have collectively spelt doom for major carriers. Carriers have been affected by unit revenue issues for quite some time and despite efforts to bring about some improvement on that front, these woes are expected to hurt carriers going ahead. Lower fuel surcharges on international flights due to weak oil prices have hurt the top line of carriers.
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