Airlines raise fares as oil's cost rises

August 12, 2005|Associated Press

CHICAGO -- Several US airlines moved yesterday to raise domestic fares by $10 to $20 per round trip as oil prices resumed their upward trek, reaching the highest level in over two decades.

The increases were initiated Wednesday by United Airlines and Delta Air Lines Inc., and followed yesterday by US Airways. American Airlines and other carriers were studying the issue.

If the increases stick, it would be at least the eighth time the industry has raised fares since mid-February, when crude oil -- the source of jet fuel -- was selling for about $45 per barrel. Yesterday, the price settled at $65.80, the highest since trading began on the New York Mercantile Exchange in 1983.

Airline travel analyst Terry Trippler predicted the latest fare boost would hold. ''When we have oil at $65 a barrel, it's got to happen," said Trippler.

Delta increased round-trip fares on most flights by $20 because of fuel prices, a spokeswoman said. On flights where it competes with low-cost carriers, Delta raised round-trip fares $6 to $10. United added $4 to $10 on round trips in the United States and Canada. Continental Airlines said the carrier matched Delta's increase; US Airways Group Inc. said it imposed similar increases to those of United and Delta.