✈️ Jet fuel prices have exploded almost overnight — and airline fares are rising just as fast. With carriers already hiking prices, cutting capacity, and warning of potential fuel shortages, your Q2 travel budget may be outdated before it even begins.

Here’s what’s happening — and what smart companies are doing right now to stay ahead 🚀

Jet fuel was $85-90 per barrel two weeks ago. Today it's trading between $150 and $200.

That's not a typo. The U.S.-Israeli strikes on Iran and the effective closure of the Strait of Hormuz - through which 50% of Europe's aviation fuel passes - have triggered the sharpest jet fuel spike since Russia invaded Ukraine in 2022.

Skift Research estimates U.S. airlines alone face $24 billion in additional fuel costs. Globally? North of $100 billion. To offset that, ticket prices need to rise at least 11% - and many airlines aren't waiting.

For context: the last time oil rose more than 40% - in 2022, after Russia's invasion of Ukraine - airfares jumped 28% (NYT). This time, the spike is even steeper, and most U.S. carriers don't hedge their fuel costs at all.

If you manage a corporate travel program, your Q2 budget was built on assumptions that no longer exist.

The moves started this week and they're accelerating fast:

United Airlines CEO Scott Kirby, speaking after a Harvard event, put it bluntly: higher ticket prices will "probably start quick" and have a "meaningful impact" on Q2 financials.

Not all airlines are equally exposed. Here's the split that matters for your booking decisions:

Well-hedged (holding prices for now):

Unhedged or minimally hedged (prices rising now):

The practical takeaway: if you're booking Europe intra-continental, hedged carriers like Ryanair, easyJet, and Lufthansa will hold prices longer. For transatlantic and transpacific routes, expect surcharges sooner - especially on unhedged U.S. airlines.

This isn't just about price. It's about whether there's enough fuel to fly.

Kuwait's Al-Zour refinery alone provides roughly 10% of Europe's jet fuel imports. With Kuwait cutting oil production as a precaution and the Strait of Hormuz disrupted, physical shortages are becoming a real possibility.

The Gulf region accounts for approximately 50% of Europe's aviation kerosene imports. Before the strikes, the north-west European jet fuel price was $830 per tonne. It has since spiked to more than $1,500 - an 80%+ increase.

Sparta Commodities' head of commodities told the BBC: "I think we're weeks away from maybe flight cancellations or delays due to lack of jet fuel, rather than months."

Finnair, despite hedging 80%+ of its Q1 fuel, warned: "A prolonged crisis could affect not only the price of fuel but also its availability, at least temporarily."

Even well-hedged airlines can't fly planes with no fuel. If the conflict drags on, expect:

Let's talk numbers. If you're a travel manager or CFO approving Q2 budgets:

And that assumes this stays a short conflict. Oil prices swung between $90 and $119 per barrel in a single day this week.

1. Audit your active bookings and pipeline. Any tickets purchased before March are locked at old fares - that's the good news. But every upcoming booking hits new pricing. Go through your Q2 travel pipeline: which trips are confirmed? Which are flexible? Prioritize booking confirmed trips now before the next round of fare increases.

2. Shift the travel mix aggressively. This is the moment to make the case for alternatives:

3. Prioritize hedged airlines in your booking policy. Ryanair, easyJet, Lufthansa, BA, and Air France-KLM have the strongest hedging positions. Build temporary routing preferences around these carriers. Their fares will stay stable longer.

4. Lock in corporate rates and advance purchases. If your TMC or booking platform supports fare-locking or advance purchase holds, use them aggressively right now. Every week of delay likely means higher prices.

5. Prepare a mid-year budget revision. Don't wait for Q2 actuals to show the damage. Model three scenarios now: short conflict (fares +10%), extended conflict (fares +25%), and supply disruption (fares +30% plus cancellations). Present options to leadership before they see the credit card bills.

GBTA had already downgraded its 2026 global business travel growth forecast from 9.2% to 8.1% before this crisis hit - citing trade tensions, policy uncertainty, and economic pressures. The projected $1.69 trillion global spend now looks optimistic.

Fitch Ratings said this week that airlines are "likely to be affected by higher fuel prices," and that hedging coverage typically declines through the year - meaning even protected carriers become exposed by Q3 and Q4.

But here's the counterintuitive part: oil shocks accelerate technology adoption. When every trip costs more, companies finally invest in tools that optimize routes, enforce advance booking policies, and surface cheaper alternatives automatically.

The companies that weathered 2022 best weren't the ones that slashed travel. They were the ones that made every trip smarter. The same playbook applies now - and the window to act is measured in weeks, not months.

Travel Code's AI-powered booking engine automatically finds optimal routing, enforces advance-purchase windows, and flags when a video call might be the better option. When every dollar counts, automation isn't a nice-to-have - it's your budget's best defense. See how it works →

How the biggest corporate travel programs are restructuring their 2026 budgets mid-year - real playbooks from companies that have been through oil shocks before.

Save up to 20% on corporate travel with Travel Code’s powerful tech, no legacy systems, and personal service across flights, hotels, and more. ✈️ 💛

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