“There Is Nothing Anyone Can Do”: A Former United CEO Says Fuel Costs Leave Airlines No Choice but to Raise Fares

Oscar Munoz, the former chairman and chief executive of United AirlinesUAL, told CNBC that airlines have run out of internal solutions for the current fuel shock: “There is nothing anyone can do technologically or with any kind of process or efficiency that can offset those sorts of costs.”

Carriers compete constantly on cost per seat mile and spend heavily on fleet renewal for fuel-efficient jets. They adjust taxi procedures and flight planning to burn less fuel. Munoz is saying this toolkit falls short against a move of this size.

How Fast Fuel Moved, by the Numbers

In the CNBC interview, Munoz said fuel prices “have come up very quickly” and that carriers “will do everything they can.” Even so, Oscar Munoz said, “they’re forced to raise prices to just cover the basic economics.”

Jet fuel on the U.S. Gulf Coast more than doubled to $4.59 a gallon on Thursday, Oct. 8, from $2.19 a year earlier, according to U.S. Energy Information Administration data. CNBC tied the surge to the start of the Iran war in February. Brent crude was $113.96 a barrel on Sept. 29, down from $130.80 on Sept. 15.

Schedule Cuts Hit Smaller Markets First

Oscar Munoz pointed to a second option: “The airlines start cutting services to areas where the economics just don’t work. … Where you have lesser performing routes, you take that aircraft and work it somewhere else.”

For travelers, that matters as much as fares do. Higher fares show up right away at checkout. Capacity cuts happen quietly, and they hit smaller markets hardest, where a route was barely profitable before fuel rose. For someone in a small city, the bigger problem may be that the flight has been removed from the schedule entirely. Munoz also said customers still want access, prices and a way to get where they want to go, and their priorities have held steady even as the economics have shifted.

Why Premium Carriers Have More Room

Munoz said that carriers with premium positioning have more room to absorb the hit than those without it. Delta Air LinesDAL has a refinery in Trainer, Pennsylvania, turning crude oil into jet fuel and giving it an advantage, according to CNBC. United’s advantage comes from premium focus. American AirlinesAAL and Southwest AirlinesLUV make up the rest of the big four.

Airline Stocks Are Already Splitting Along His Lines

Share price change over the past 12 months, through Oct. 9

Through the Oct. 9 close, Delta led year to date, up 18.4%, and American trailed, down 16.8%. Over twelve months, Delta led, up 37.9%, and United trailed, up 6.0%. The carrier marked as best protected is the strongest stock over the past year.

Over five years, the order changes. United leads at 118.6%, followed by Delta at 89.4%, while Southwest stands at −22.7% and American at −36.4%. The twelve-month leader trails over five years, and two of the four trade below where they were five years ago. One year of data does not decide which business model wins.

These figures measure share price performance only and say nothing about operating results.

Delta’s Quarter Through an Industry Lens

Munoz framed Delta’s result as evidence of an industry-wide squeeze. CNBC called it Delta’s first miss in two years. Adjusted earnings per share were $1.72, according to Delta’s earnings release. Investors can review primary documents in Delta’s SEC filing. Delta CEO Ed Bastian, interviewed on CNBC the same morning, explained why Delta passed on Starlink.

Where today sits

Jet fuel prices more than doubled in a year. Before 2026, that happened in 11 months since 1991.

Change in the U.S. Gulf Coast jet fuel spot price from the same month a year earlier, using monthly averages. The shaded bands hold the middle half and the middle 80% of all 426 readings. The last time prices rose this fast was June 2022.

Middle half: −14% to 35%Middle 80%: −37% to 64%Median 2%

Middle half: −14% to 35%Middle 80%: −37% to 64%Median 2%

Fares and Schedules Are the Only Levers Left

Munoz has run one of these companies, and his view is that no smart operational fix can offset a fuel move this large. That leaves airlines with two options, fares and schedules, and passengers feel both. Fuel costs reach consumers beyond airfares, too: higher diesel prices work their way into grocery bills, automotive expert Lauren Fix has said.