United CEO on 2027 Fares: Fuel Stays High, Passes Costs

United Airlines CEO Scott Kirby stated during an appearance on CNBC prior to unveiling new international routes at Newark on Tuesday that he anticipates oil prices to gradually decline heading into 2027. However, he emphasized that prices will remain higher than historical averages, as surging oil costs driven by the Iran war have heavily impacted airline profitability and forced carriers to adjust ticket prices accordingly.

Airfares across the industry increased by more than 20 percent this year to offset spiking fuel expenses. Kirby noted that carriers possess the pricing power to fully pass these mounting costs onto consumers. He further explained that rising labor, maintenance, and airport fees, alongside reduced domestic capacity resulting from the collapse of Spirit Airlines, have strengthened major airlines' pricing leverage, effectively bringing a permanent end to ultra-low fares such as 9-dollar tickets to Central America.

Stock photo for illustration only, not from the actual event

Despite United's heavy bet on enduring travel demand to maintain pricing levels, Wall Street analysts remain skeptical regarding how long these pricing gains can persist. Analysts warn that planned double-digit capacity growth from carriers like American Airlines and United could eventually pressure and undermine fares.