United Airlines (UAL) Slashes Flight Schedule 5% Amid Soaring Fuel Prices

Key Takeaways

• United Airlines shares declined 4.46% Friday following CEO Scott Kirby’s announcement of a 5% reduction in planned flights.
• Since late February, jet fuel prices have surged nearly 100% amid the Iran conflict.
• The carrier is scenario-planning for crude oil reaching $175 per barrel, with prices potentially remaining above $100 until late 2027.
• At present fuel price levels, United faces an additional $11 billion in annual fuel expenses.
• Despite capacity cuts, United will maintain its aircraft delivery schedule and avoid employee furloughs.

United Airlines (UAL) saw its shares fall 4.46% Friday after CEO Scott Kirby informed employees the airline would reduce its flight schedule by approximately 5%. The decision follows a dramatic spike in jet fuel costs, which have almost doubled since late February due to escalating conflict in Iran.

United Airlines Holdings, Inc., UAL

In an internal memo published on the company’s official website, Kirby detailed the challenging outlook ahead. The airline is preparing contingency plans for crude oil prices potentially reaching $175 per barrel, with expectations that prices could remain above $100 through 2027’s end.

If these projections materialize, the additional fuel expenditure would approach $11 billion annually — exceeding twice the profit United generated during what Kirby described as the company’s most successful year on record.

The airline has been systematically eliminating underperforming routes. This includes certain midweek departures, Saturday services, and red-eye flights experiencing softer passenger demand.

According to the revised operational plan, United will eliminate approximately three percentage points of lower-demand flying during the second and third quarters. Additionally, the carrier will reduce roughly one percentage point of capacity from its Chicago O’Hare hub.

Routes to Tel Aviv and Dubai remain suspended indefinitely. Combined, these adjustments represent approximately five percentage points of the airline’s annual capacity projections.

Kirby indicated that United intends to resume full scheduling this autumn — provided fuel costs stabilize rather than continue climbing.

Rising Ticket Prices Provide Some Relief

Strong travel demand is offering partial relief from mounting costs. Major U.S. carriers have successfully implemented two consecutive fare increases of approximately $10 per direction. Kirby noted that bookings completed over the past week showed fare increases of 15% to 20%.

According to Melius Research analysts, robust booking trends could support an additional 5% to 7% fare adjustment. United revealed that the initial 10 weeks of 2026 represented the strongest booking period in company history.

Competitor Delta Air Lines has similarly signaled willingness to reduce capacity if elevated prices persist, following an upward revision to its first-quarter revenue guidance this week.

U.S. carriers face particular vulnerability compared to certain European and Asian competitors — the majority don’t employ fuel hedging strategies, leaving them significantly exposed to volatile price fluctuations.

Growth Plans Remain Intact

Notwithstanding immediate capacity reductions, Kirby assured employees that United’s broader expansion strategy remains unchanged.

The airline will proceed with accepting delivery of approximately 120 new aircraft throughout this year, including 20 Boeing 787 wide-body jets. An additional 130 aircraft are scheduled for delivery by April 2028.

Kirby emphasized that United will avoid employee furloughs and maintain planned investments — marking a departure from strategies employed during previous industry downturns.

In after-hours trading Friday, UAL stock recovered slightly, gaining 1.49% to reach $91.29, clawing back some of the session’s losses.

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