Washington — Chevron’s chief govt predicted vacationers may see airline fares rise and fewer flights obtainable within the coming weeks, because the standoff with Iran over the Strait of Hormuz continues to rattle international markets and drive up the value of gasoline.
“We’ve seen some upward pressure on gasoline prices now. I think aviation is clearly an area where it’s going to probably get worse over the next few weeks,” Chevron CEO Mike Wirth stated in an interview Thursday with “Face the Nation with Margaret Brennan.”
“We are seeing jet fuel tighten very quickly in Europe, in Asia, and we’re seeing airlines announce adjustments in their flight schedules. We’re seeing it flow through into fares. I think that’s one of the first places it will be felt most broadly,” he stated.
Wirth stated there was already a jet gasoline scarcity in sure elements of the world earlier than the struggle with Iran started on Feb. 28. Airlines have hiked their bag test charges and lower routes because the begin of the struggle in response to the disaster. Carriers based mostly within the U.S. are barely higher positioned than European airways as a result of the U.S. produces its personal jet gasoline.
“I think the upward pressure that they’re seeing on prices and the tightness in the market is likely to lead to further route optimization. And so flights may not be as abundant as they otherwise would have been. I think planes will probably be more full than they would have been,” Wirth stated.
“And yes, fares — fares could be higher,” he added.
In North America, jet gasoline costs have surged greater than 80% in contrast with this time final yr, according to the International Air Transport Association.
The common value of gasoline nationwide was $4.03 per gallon on Thursday, approaching practically a greenback greater than the value per gallon a yr in the past, in keeping with CBS News’ value tracker. Diesel, which powers vans, boats and trains, has risen extra shortly than common gasoline and was at $5.47 per gallon on Thursday.
Watch extra of the interview Sunday on “Face the Nation with Margaret Brennan.”