New York (AP) - Delta Air Lines Inc. raised fares $10 one-way
on most domestic routes, primarily to offset higher fuel costs, a spokeswoman
Rick Seaney, chief executive of airfare tracking Web site FareCompare.com, said Delta's fare increase is the tenth attempted by major carriers since Labor Day Weekend. Many of the previous broad-based increases have been limited to $5 one-way.
Delta spokeswoman Susan Elliott said the airline raised fares because of "increasing cost pressures on our business, most notably fuel.
"In the face of record fuel costs, fares remain comparatively low," she added.
Oil futures have surged to record levels, setting an all-time high of $99.29 last week. That is within range of inflation-adjusted all-time highs set in early 1980.
On Tuesday, however, oil prices tumbled amid concerns of an economic slowdown and speculation that the OPEC may boost production. Light, sweet crude for January delivery fell $2.93 to $94.77 a barrel on the New York Mercantile Exchange.
Carriers often match competitors' increases within a matter of hours. The fare hikes don't always stick, though, as airlines jockey to remain competitive with low-cost carriers like Southwest Airlines Co. and JetBlue Airways Corp.
"The frequency and overall stickiness of these increases has me wondering how high U.S. domestic airline ticket prices might go in a $100+ barrel of oil environment," FareCompare's Seaney said in an e-mail. "It is pretty obvious that legacy airlines have not hit a point yet where they are skittish about continued airfare increases."
Seaney added the fares at low-cost carriers are not the barrier they once were to increases by the larger airlines.
Delta shares rose 42 cents to $17.90.