The Air Transport Association has said that continued rising jet fuel prices are impeding the remarkable overall progress being made by the U.S. airline industry to return to
profitability.“Record crude oil prices, which are expected to average nearly $70 per
barrel this summer, will hamper the industry’s widespread efforts to
reverse the losses that have plagued the airlines in recent years,” said
ATA Vice President and Chief Economist John Heimlich. Data from the U.S.
Energy Information Administration shows that the price of benchmark
crude oil averaged $63.27 in the first quarter of 2006, up 27 percent
from the same period in 2005. Accordingly, the average price of jet fuel
rose approximately 40 cents per gallon, from $1.45 to $1.85. “These high
fuel prices highlight the need for airspace modernization to mitigate
fuel expenses. A modernized system could save hundreds of millions of
gallons of jet fuel per year, not to mention the environmental benefits
that such improved operational efficiency would produce,” said Heimlich.