Airlines Start Cancelling Flights as Jet Fuel Prices Explode

Jet fuel costs are rising again across the airline industry, and major U.S. carriers said that is starting to affect flight schedules. American Airlines, United Airlines and Southwest Airlines all discussed the issue on September 17 at Morgan Stanley’s 14th Annual Laguna Conference. The immediate result is a mix of cancelled or reduced flights, especially as carriers head into the fourth quarter.

American, United and Southwest signal schedule cuts

American Airlines said it will keep adjusting capacity later in the fourth quarter as fuel prices stay above earlier expectations. Chief Financial Officer Devon May said jet fuel is running about $1 per gallon above what the airline projected in July, adding roughly $1 billion to American’s fuel bill for the fourth quarter. He said the change in fuel costs built up over the previous four weeks.

United Airlines confirmed some planned December flights will not operate. Chief Financial Officer Michael Leskinen said at the September 17 conference that there will be flights in December “that we won’t fly that we thought we were going to fly.” He also said United could make more adjustments in the first quarter and beyond into 2027 if fuel remains high.

Southwest Airlines said it has already reduced about half of the modest year-over-year capacity growth it had planned at the start of 2026, according to Chief Financial Officer Tom Doxey. A Southwest spokesperson later said the actual schedule adjustments so far have been minimal and that Doxey was making an illustrative point, not describing a broader action already taken.

What travelers around the U.S. know so far

So far, the airlines have confirmed schedule pressure at a national level, but not a route-by-route list of cuts. United specifically said some December flights are being removed, while American said it is adjusting fourth-quarter capacity and Southwest described only minimal changes so far. None of the three carriers released a full public list of affected airports or city pairs on September 17.

That means travelers in specific states and metro areas do not yet know the full local impact. The companies have not released a comprehensive list of affected routes, including whether cuts will fall more heavily on smaller airports, leisure markets or hub cities. What is confirmed is that the changes are tied to late-year scheduling decisions, not a broad drop in demand.

Executives from both American and United said bookings remain solid. United said fourth-quarter bookings were “tremendously strong,” with premium, corporate and economy demand holding up, while American said it still expects third-quarter revenue to rise 16% to 19% from a year earlier.

Why fuel prices are driving airline decisions

The main pressure point is fuel. The global average jet fuel price rose 6.1% week over week to $181.46 per barrel last week, according to the International Air Transport Association. That increase hit just as airlines were finalizing late-2026 schedules and watching fourth-quarter operating costs.

American gave the clearest example of the math. May said the carrier’s fourth-quarter fuel expense is now about $1 billion higher than expected because prices climbed roughly $1 per gallon from July assumptions. United said the practical response is to stop flying some lower-margin trips if the cost of operating them no longer makes sense.

For passengers, the near-term expectation is a tighter schedule rather than a collapse in service. Airlines said demand has held up, and Southwest said stronger fall bookings have helped offset higher fuel costs enough to maintain its third-quarter earnings guidance. For now, the industry is signaling targeted adjustments, with more clarity likely to come as winter schedules are finalized.