Oil Prices Have Fallen. So Why Haven’t Airfares?

July 7, 2026

AI Summary

5 min read

Oil Prices Have Fallen. So Why Haven’t Airfares?

Jet fuel prices have dropped 40% from their April peak, but airline ticket prices aren't following them down. The reason, according to WSJ reporter Alison Sider, is that airlines have discovered they have pricing power and aren't eager to give it up. "People are still traveling and they've shown a willingness to pay these higher fares," Sider explained. There's less capacity in the market—airlines have cut routes and flying—and Spirit Airlines, which once forced competitors to match its bargain fares through price competition, is gone. That elimination of a major discount player has removed a key check on fares. Airlines are set to report second-quarter earnings starting with Delta on Friday, and while fuel costs were high for much of the quarter, carriers only captured about 40-50% of those higher costs through fare increases. The bigger question for analysts is what demand looks like after Labor Day—whether the strong summer travel bookings reflect genuine sustained demand or just people committed to their summer vacations. Historically, airlines have never been able to hold onto higher fares because competitors eventually undercut them, but carriers are optimistic this time is different.

AI Companies Compete for Enterprise Clients With Old-School Discounts

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What you'll learn

1 (01:11) **Bernie Sanders Calls for Graham Platner to Drop Out** - Democrats rescind endorsements after a sexual assault allegation; Platner denies it.
2 (02:04) **Trump’s New Helipad at the White House** - A granite helipad is under construction on the South Lawn, funded by a $5 million donation from Lockheed Martin.
3 (02:36) **U.S. Revokes Iran’s Oil Sales License** - The Trump administration pulls the main economic benefit from the interim peace deal, hours after Iran fired missiles at ships near the Strait of Hormuz.
4 (02:56) **Trump in Turkey for NATO Summit** - Trump says he would consider selling F-35s to Turkey, setting up a potential clash with Congress over a 2020 law barring the sale due to Turkey’s Russian air defense system.
5 (03:39) **Marine Le Pen to Run in French Presidential Election** - The far-right leader announces her candidacy after a court reduces her sentence for misusing EU funds, clearing her path to run.
6 (04:00) **AI Companies Compete for Enterprise Clients with Discounts** - OpenAI and Anthropic offer steep discounts, especially on coding tools, to win over fickle startup customers.
7 (07:19) **Markets: Samsung Update Disappoints, Tech Stocks Fall** - The NASDAQ closed down 1.2%, and the Dow and S&P also dropped.

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Show Notes

P.M. Edition for July 7. Airlines raised prices after the Iran war to cover rising fuel costs. Now, fuel prices have fallen, but travelers may find that their ticket price hasn’t. Journal reporter Alison Sider explains. Plus, the Trump administration revokes a waiver that allowed Iran to sell oil after recent attacks in the Strait of Hormuz, threatening to unravel a shaky peace deal. And artificial intelligence companies like OpenAI and Anthropic want businesses to buy their cutting-edge products. Now they’re sweetening the deal with discounts. We hear from WSJ reporter Berber Jin about just how lucrative these credits are for the Silicon Valley startups using them. Alex Ossola hosts.

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