# American Airlines Warns Airfares Will Not Drop to Pre-War Levels Amid High Fuel Costs

> American Airlines projects a 2026 financial loss and states airfares will remain elevated due to persistently high jet fuel prices stemming from the 'Iran war.'

By PrimaryBrief newsroom · Published 2026-10-26T04:41:26.120895Z
Canonical: https://primarybrief.com/article/american-airlines-warns-airfares-will-not-drop-to-pre-war-levels-amid-high-fuel-costs-e73dd21b

American Airlines announced that airfares are unlikely to revert to pre-'Iran war' levels, forecasting a 2026 financial loss due to persistently high jet fuel prices [1]. This means consumers face higher travel costs, impacting budgets. The situation also highlights global economic instability driven by geopolitical tensions and rising energy expenses [1][2][3][4].

## What the records show
American Airlines expects a full-year 2026 adjusted loss between $1.00 and $1.60 per share, reversing earlier guidance that included a potential profit [9][25]. This forecast stems from a near 90% surge in jet fuel prices since the U.S.-Israeli war on Iran began in February 2026 [8][24][25]. Jet fuel rose from $2.43 per gallon to $4.63 by October 20, 2026 [24]. The airline's third-quarter 2026 report showed a $269 million loss, primarily because fuel costs were 67.5 percent higher than the previous year [7][10]. Delta and Southwest have also cut their annual earnings forecasts [8].

## Timeline
The "Iran war" started in February 2026 [1]. On February 28, 2026, the United States and Israel launched military strikes against Iran, targeting nuclear and military infrastructure after Iran's refusal to end nuclear enrichment [11][12][13]. These joint operations, code-named Operation Epic Fury, concluded on May 5, 2026 [13]. However, by October 2026, oil prices hit a five-month high, with Brent crude near $116.72 a barrel, due to renewed attacks and Strait of Hormuz disruptions [3][16][17]. Reports indicate plans for renewed U.S.-Israeli strikes against Iran after the U.S. midterm elections in November [19][21][22][23].

## What changed and for whom
Consumers face sustained higher airfares. American Airlines CFO Devon May stated fares will likely remain elevated even if fuel prices drop, and will increase if fuel costs rise further [1][25]. Airlines have raised fares to protect margins, but these increases have not kept pace with soaring jet fuel prices [27]. For airlines, the result is financial losses and reduced profitability despite steady demand [1][7][8]. Globally, markets are reacting: Japanese stocks declined due to the conflict and high energy costs [2]. U.S. stocks fell as oil prices hit a five-month high [3][18], and Australia's Reserve Bank is expected to raise interest rates amidst oil price jumps [4][14][28].

## What the subject has said publicly
American Airlines Chief Financial Officer, Devon May, stated that if fuel prices decrease, airfares will "probably stay largely where they're at right now" [25]. He further clarified that if fuel prices increase, the airline "need[s] to generate higher yield, we need to generate higher fares to offset that higher fuel price" [25]. May also told Reuters that "If fuel stays elevated, we have to continue to push yield up so that we can make a bit of money" [8][26].

## What we could not confirm
We could not confirm the exact timeline or comprehensive scope of any planned renewed U.S.-Israeli military strikes against Iran [19][21][22][23]. We also could not confirm the precise long-term impact such potential actions would have on global oil and jet fuel prices.

## Evidence cited
1. Airfares will not return to pre-Iran war levels, American Airlines warns (www.ft.com) — https://www.ft.com/content/d114ce00-f30d-41c6-ac03-71209aa62ee2?syn-25a6b1a6=1
2. Nikkei Falls 0.5%, Dragged by Chip, Electronics Stocks (www.wsj.com) — https://www.wsj.com/finance/stocks/nikkei-falls-0-5-dragged-by-chip-electronics-stocks-eed519a4?mod=rss_markets_main
3. U.S. Stocks Fall as Oil Prices Hit Five-Month High (www.wsj.com) — https://www.wsj.com/finance/stocks/u-s-stocks-fall-as-oil-prices-hit-five-month-high-a800db83?mod=rss_markets_main
4. Live: Market puts chance of November interest rate hike above 60pc (www.abc.net.au) — https://www.abc.net.au/news/2026-10-26/asx-markets-business-live-news-october-26/107306820
5. Iran war live: Trump rules out strikes ‘today’; missile downed near Riyadh (www.aljazeera.com) — https://www.aljazeera.com/news/liveblog/2026/10/26/iran-war-live-trump-rules-out-strikes-today-israeli-forces-raid-hebron?traffic_source=rss
6. Iranians Face Anxious Wait as Threat of Attack Looms (www.nytimes.com) — https://www.nytimes.com/2026/10/24/world/middleeast/iranians-face-anxious-wait-as-threat-of-attack-looms.html
7. American Airlines Posts Deepest Fuel Loss Since the Pandemic (travelerstoday.com) — https://travelerstoday.com/
8. US Airlines Fly With Empty Seats, Not Low Fares, To Protect Profits Amid Soaring Fuel Costs (globalbankingandfinance.com) — https://globalbankingandfinance.com/
9. American Airlines Now Expects a Full-Year Loss as Jet Fuel Costs Outpace Fares (qz.com) — https://qz.com/
10. American Airlines posts Q3 loss due to soaring fuel costs from US-Iran war (jamaicaobserver.com) — https://jamaicaobserver.com/
11. The War in Iran (cfr.org) — https://cfr.org/
12. Iran War (2026) (wikipedia.org) — https://wikipedia.org/
13. What was the Iran war of 2026? (britannica.com) — https://britannica.com/
14. Oil price climbs to $115; US stocks fall at the open (theguardian.com) — https://theguardian.com/
15. The War in Iran is Costing Americans Billions (quincyinst.org) — https://quincyinst.org/
16. Nasdaq plunges 1.7% as Meta shares fall 5.5% and oil prices hit five-month high (share-talk.com) — https://share-talk.com/
17. Stock Market Today: Dow Slides as Oil Hits Five-Month High, Crosses $116 (eurasiabusinessnews.com) — https://eurasiabusinessnews.com/
18. Dow Jones Top Markets Headlines at 1 PM ET: U.S. Stocks Fall as Oil Prices Climb to Highest in Five Months (morningstar.com) — https://morningstar.com/
19. US, Israel plan renewed Iran strikes after midterms, focusing on short, intense attacks — report (timesofisrael.com) — https://timesofisrael.com/
20. Iranian leaders believe renewed US strikes are inevitable, warn Washington against attacking (jpost.com) — https://jpost.com/
21. The US and Israel Are Reportedly Planning Strikes on Iran After Midterms (time.com) — https://time.com/
22. US and Israel prepare massive attack on Iran after midterms (wsws.org) — https://wsws.org/
23. U.S. and Israel planning for a possible attack on Iran, source tells NPR (ualrpublicradio.org) — https://ualrpublicradio.org/
24. Why your plane ticket might not get cheaper even if fuel prices fall (ground.news) — https://ground.news/
25. American Airlines CFO: Fares Won't Fall Even If Fuel Prices Drop (airlinegeeks.com) — https://airlinegeeks.com/
26. American Airlines' losses in 2026 due to fuel prices (newscord.org) — https://newscord.org/
27. American Airlines forecasts 2026 loss as jet fuel costs bite (kfgo.com) — https://kfgo.com/
28. RBA Rate Hike: Australia Inflation Data The Decider (stonex.com) — https://stonex.com/
29. RBA rate rise risks turning oil shock into recession (independentaustralia.net) — https://independentaustralia.net/
30. RBA poised to hike rates on Cup Day as oil prices ratchet up (michaelwest.com.au) — https://michaelwest.com.au/
31. Australian Dollar defies Iran war jitters as RBA hike bets double (mitrade.com) — https://mitrade.com/
32. Olivers Insights: The RBA hikes again on the back of the boost to inflation from the Iran War (amp.com.au) — https://amp.com.au/
33. 5 things we learned at the CBA-UBS Infrastructure Conference (commbank.com.au) — https://commbank.com.au/
34. AUD/USD drops as US Dollar extends recovery despite Iran tensions (fxstreet.com) — https://fxstreet.com/
35. Oil prices hit 6-month high amid US-Iran strike fears (tbsnews.net) — https://tbsnews.net/
36. Why Oil Prices Jumped as Iran Diplomacy Stalled in October 2026 (thefactbridge.com) — https://thefactbridge.com/
37. Asian shares fall, oil prices slide after rising to 5-month high (local10.com) — https://local10.com/
38. Trump, Netanyahu Threaten Iran Amid Diplomacy Over Strait of Hormuz (iranintl.com) — https://iranintl.com/
39. US, Israel weigh renewed strikes on Iran; Tehran threatens to unveil 'father of all bombs': Reports (newindianexpress.com) — https://newindianexpress.com/
40. Japanese stocks fall as Mideast conflict escalates, oil prices jump (japantimes.co.jp) — https://japantimes.co.jp/
41. Asian Stocks Fall Sharply on Renewed US Airstrikes on Iran, Soaring Oil Prices (moderndiplomacy.eu) — https://moderndiplomacy.eu/
42. Asian stocks fall as Mideast conflict escalates, oil prices jump (thenationalherald.com) — https://thenationalherald.com/