United CEO says to expect higher fares as jet fuel prices rise, takes swipe at rivals’ strategies

Jet fuel prices are rising to levels not seen since before the Covid pandemic and it’s set to drive up airfares, United CEO Scott Kirby said Wednesday. “Higher jet fuel prices lead to higher ticket prices,” Kirby told CNBC’s “Squawk on the Street.” “Ultimately, we’ll pass that through.” United forecast average fuel costs of $2.39 a gallon in Q4, when it expects a surge in bookings from the end-of-year holidays and recently loosened international travel restrictions. That’s up from $2.14 a gallon in the third quarter and the $2.02 on average it paid in the fourth quarter of 2019. Kirby said higher demand usually drives fuel prices up. The increase in travel is a welcome trend for an industry that continues to struggle to return to profitability. Kirby credited United’s relatively conservative capacity additions in the last few months when asked why the carrier didn’t have the mass cancellations that have hit competitors, such as Southwest last week. “We didn’t get out over our skis,” he said on a call with analysts and reporters on Wednesday. Kirby also said the Biden administration’s vaccine mandates could pose a risk to the operations of some of its rivals. United says that more than 96% of the company’s staff is already vaccinated against Covid-19 after it implemented its own mandate in August, which put employees at the risk of losing their jobs if they didn’t comply or get an exemption.<br/>