Anabelle Colaco
12 Oct 2026

CHICAGO, Illinois: Soaring fuel costs have forced Delta Air Lines to slash its annual profit forecast by nearly a quarter, highlighting the mounting pressure on global airlines as the Iran war drives jet fuel prices sharply higher.

Delta said it expects its fuel bill to increase by US$6 billion in 2026, overwhelming resilient travel demand and higher ticket prices. The carrier also raised its projected fuel-cost increase by $2 billion.

Its shares fell 2.5 percent in early trading after Delta cut its 2026 profit forecast for the first time this year. With no end to the war in sight, carriers are confronting their worst crisis since the pandemic.

Delta, the first major global carrier to report third-quarter results, said fuel expenses jumped 62 percent from a year earlier to $4.1 billion, more than $500 million above its July forecast.

"All of it is fuel," Delta Chief Financial Officer Erik Snell told reporters when asked what drove the forecast cut, citing increases in both crude oil and refined jet fuel prices since the summer.

Delta now expects adjusted annual earnings of $5.10 to $5.60 a share, down from its July forecast of $6.50 to $7.50. The midpoint of $5.35 is below analysts' average estimate of $5.46, according to LSEG data.

Third-quarter adjusted earnings of $1.72 a share narrowly missed analysts' average estimate of $1.76, while its adjusted operating margin fell to 9.4 percent from 11.1 percent.

The rising costs are becoming an industry-wide problem. U.S. airlines spent $42.9 billion on fuel for scheduled flights in the first eight months of 2026, nearly $13.2 billion more than a year earlier despite using slightly less fuel, according to the Bureau of Transportation Statistics.

Strong demand and limited seat growth have allowed airlines to pass some of those costs on to passengers. U.S. airfares rose about 25 percent from a year earlier in the five months through August.

Delta said demand remained strong, with almost 60 percent of the fourth quarter already booked. It expects revenue to grow about 20 percent from a year earlier.

"At the moment, those higher prices have not destroyed any demand, and it remains to be seen how long that will last," Third Bridge analyst Liam Dorsey said.

Delta also expects its refinery outside Philadelphia to generate $700 million in profit this year, providing a partial cushion against higher fuel costs.

"We have a refinery that gives us an offset, a partial offset to fuel prices that no one else does," Snell said.

Even with that benefit, Delta expects its fuel cost to rise to $4.25 a gallon in the fourth quarter from $3.61 in the third.

"Ultimately, fuel will come down. When that is, we're not exactly sure," Snell said.