Continental, Northwest Hike Air Fares

Updated from 11:50 a.m. EST

The high price of oil is hurting the revenue recovery seen by legacy carriers, forcing Continental Airlines (CAL Quote) to boost ticket prices effective immediately. But in a surprise, Northwest Airlines (NWAC Quote) has matched the hike in some markets, which could pave the way for higher ticket prices industrywide.

On Friday morning, Continental announced that it would add $10 to all restricted and unrestricted roundtrip fares in the contiguous 48 states, citing high fuel costs as the motivating factor.

"Fuel prices -- which we can't control -- are the highest we have ever seen," said Jeff Misner, CFO, in a statement. "Meanwhile, Continental travelers in 2003 paid the lowest fares since 1994. This fare increase is a step toward matching fares with the cost of providing air travel in this environment." ...