Flights are already getting more expensive after jet fuel spike. When should you book?

The surge in fuel prices since the U.S. and Israel attacked Iran nearly two weeks ago is already driving up airfare. Consumers’ appetite for travel this year will dictate just how much.

Cathay Pacific on Thursday said it would roughly double fuel surcharges on tickets starting March 18.

Earlier this week, Australia’s Qantas said it is raising fares to help cover its costs, Scandinavian Airlines said the “unusually rapid and substantial increase” in fuel prompted it to raise prices, and Air New Zealand pulled its financial outlook “until fuel markets and operating conditions stabilise,” adding that it has made “initial fare adjustments.”

“If the conflict leads to continued elevated jet fuel costs, the airline may need to take further pricing action and adjust its network and schedule as required,” Air New Zealand said.

U.S. airline CEOs and other executives will update investors on Tuesday at the J.P. Morgan Industrials Conference in Washington, D.C.

Analysts expect an earnings hit at least in the first quarter if not the first half of the year, though the impact will depend on how long higher fuel prices last.

“We think a hit to 1Q EPS appears almost certain at this point,” UBS airline analysts Atul Maheswari and Thomas Wadewitz wrote in a note last week.

United Airlines CEO Scott Kirby said last week on the sidelines of an event at Harvard University that higher fares were likely on the way because of the surge in fuel prices.

Kirby said travel demand is still strong, however. Two other senior airline executives at U.S. carriers, speaking on the condition of anonymity because they weren’t authorized to speak to media, also said travel demand has held up. If those trends persist, it could give airlines more pricing power, but that will depend on the war’s duration.

“Airlines never met a higher fare they didn’t want,” said Scott Keyes, the founder of flight-deal company Going, previously known as Scott’s Cheap Flights.

So what should consumers do?

Keyes said travelers can’t lose by booking early, as long as they’re not buying restrictive basic economy tickets. That way, customers can try to exchange or cancel their tickets and buy cheaper ones if airfare ends up falling.

“If you book a $500 summer flight today, and two weeks from now the price drops to $350, you can call up the airline and get the $150 difference back as a credit. Heads you win; tails the airlines lose,” he said.

Jet fuel is airlines’ biggest cost after labor, accounting for about a fifth or more of expenses, depending on the airline.

United alone spent $11.4 billion last year on fuel, at an average price of $2.44 a gallon, according to its annual report securities filing. U.S. jet fuel on Wednesday was going for $3.78 a gallon, according to Platts.

Jefferies airline analyst Sheila Kahyaoglu said in a note Thursday that she expects “the most acute financial impact to airlines from surging oil prices to be in the next 30-90 days as airlines have been booking yields for close-in flights assuming a much lower fuel price and carriers cannot retroactively raise fares.”

She said Delta Air Lines and United, which produce most U.S. airline profits, are better positioned than other carriers because of their high-end demand. Risks to demand, particularly for more price-sensitive customers, include the recent jump in gasoline prices.

Jet-fuel have more than doubled in some regions since the first U.S.–Israel attacks on Iran on Feb. 28.

Oil prices surged to roughly four-year highs after the initial attacks. Energy prices have since swung wildly since then as traders assess just how long the war — and all the logistics headaches — could last.

U.S. jet fuel prices were up more than 60% from before the attacks to a peak last week, according to pricing data assessed by Platts. Jet fuel can rise by a greater degree than crude because it includes the price of processing and ever-more difficult and costly transportation from oil fields to refineries to airplane fuel tanks.

On Feb. 27, the day before the before the attacks, the cost to fill the fuel tanks of a Boeing 737-800 would have would have been about $17,000 based on average prices in New York, Houston, Chicago and Los Angeles, compiled by Argus. Less than a week later, on March 5, it would have cost more than $27,000, based on Argus prices. On Tuesday, after oil prices fell following President Donald Trump‘s comment that the Iran war could end “very soon,” it would have cost around $23,000.

After prior fuel price surges, airlines started making customers pay for bags — or charging them more. Even seemingly minor changes in weight can save airlines hundreds of thousands, if not millions of dollars, a year in fuel. United in 2018 changed to a lighter paper stock for its in-flight magazine. In 2014, American Airlines said it would switch to digital manuals for flight attendants, following changes for pilots. It said at the time that it would save $650,000 in fuel a year.

High fuel prices don’t automatically mean higher fares. The ongoing strong demand for travel is a key factor and so is capacity, or the amount that carriers fly.

If airlines raise fares and passengers balk, then capacity will likely go down in the form of fewer frequencies on a route or broader cuts, in more severe cases.

“Airlines love to say fuel is expensive so you have to pay more. What they’re doing is they’re setting the expectation,” said Courtney Miller, founder of Visual Approach Analytics, an airline-industry advisory firm. “They price to prevent empty seats.”

If fuel prices come down, “they’re not suddenly saying ‘We’re making too much money,'” Miller added. “But they are likely to add another flight.”

Capacity, especially to and from the Middle East, is constrained because of airspace closures and other stop-and-start flights. More than 46,000 flights have been canceled to and from the region since the Feb. 28 attacks began, aviation-data firm Cirium said.

Those constraints are driving up fares as well as demand, as United’s Kirby said, from regions where customers are looking for alterative routes.

Airspace closures are also requiring airlines to take longer, more fuel-guzzling routes, but many have strong demand, too.

Qantas, for example, told CNBC that its flight from Perth, Australia, to London is temporarily stopping in Singapore to refuel, allowing it to pick up another 60 customers, and that its Perth-London and Perth-Paris routes are more than 90% full this month, 15 percentage points higher than normal for this time of year.

Finnair said the increased demand for travel to Asia from Helsinki, Finland, has pushed up its prices by 15% on average.

“The impact of higher fuel prices will be reflected in market fares with a delay, as airlines typically hedge at least part of their fuel purchases,” it said.

Airlines have been grappling with airspace closures for years, including from on-and-off conflict in the Middle East and since Russia’s 2022 invasion of Ukraine, that have left a large swath of airspace out of use for many carriers.

Most U.S. airlines no longer hedge fuel costs, or lock in prices using futures and other securities. Southwest Airlines was one of the last holdouts, and it quit last year. A spokesman for the Dallas-based airline told CNBC that Southwest currently has “no plans” to resume hedging.

That leaves U.S. carriers more susceptible to price swings.

Kirby said there would likely be an impact to United’s first-quarter results and to the second quarter if the war — and blockage of the Strait of Hormuz, a key shipping channel — persists. However, he said demand was increasing sharply from regions that have been affected by the thousands of flight cancellations and airspace closures in the Middle East.

Because of airlines’ upbeat outlooks on demand to start the year, “the environment is conducive for passing along fare increases. Further, should jet fuel stay higher for longer, it should help push off-peak capacity lower,” supporting unit revenues, UBS analysts said.

Rick Joswick, who heads of near-term oil research and analytics at S&P Global Energy, told CNBC that “demand for jet fuel is inelastic. You cannot shortchange an airport. If the cost of jet fuel goes up, it’s not like the plane will choose not to fly that day.

“You can’t dry up an airport,” he said.