High oil=low prices?
by Kate Bonamici and Barney Gimbel, FORTUNE Magazine

(FORTUNE Magazine) - Delta (Research) and Northwest (Research) may finally settle the showdown with their pilots' unions this month, but that won't bring an end to industry chaos.

Though oil prices and airfares are still on the rise, don't expect it to last. Why? Because that would make sense--something the airline business rarely does.

"Expect fares to fall," says veteran industry pundit Joe Brancatelli. "It is what has happened every time oil prices have spiked." One reason: Airlines always overestimate what business travelers will pay. So as walk-up fares increase, business travel decreases. To make up the short-fall, airlines start price wars. It might all add up to reasonable summer fares. Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.