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Higher Jet Fuel Prices Mean Higher Airfares: United CEO Kirby

United anticipates an average price of $2.39 a gallon in the fourth quarter, up from $2.14 a gallon in the third quarter and $2.33 last week.
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Airfares will head higher, thanks to soaring jet fuel prices, United Airlines  (UAL) - Get United Airlines Holdings, Inc. Report CEO Scott Kirby said Wednesday.

“Higher jet-fuel prices lead to higher ticket prices,” he told CNBC. “Ultimately, we’ll pass that through.”

Jet fuel’s price stood at $2.33 per gallon Oct. 15, according to Platts.

United anticipates an average price of $2.39 a gallon in the fourth quarter. That represents an increase from $2.14 a gallon in the third quarter and $2.02 in the fourth quarter of 2019, CNBC reports.

A boost in customer demand should be coming, thanks to the easing of international travel restraints and thanks to holiday vacations, the airline says.

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United on Wednesday closed at $45.95, down 0.6%. It has climbed 4% in the past month, with COVID-19 waning.

United released third-quarter earnings Tuesday showing that its revenue beat analyst estimates. And Kirby said the company is on target to meet its goals for 2022.

While the airline’s third-quarter sales of $7.75 billion beat analysts' forecast of $7.64 billion, they were 32% lower than the same period in 2019, before the pandemic.

United’s adjusted diluted loss of $1.02 per share also beat analysts' estimate of a $1.67 loss.

United reported net income of $473 million, which was 54% lower than its income of $1.02 billion for the same period in 2019.

"The recovery was delayed by the delta variant, but the United team remains focused on our long-term vision – and not getting sidetracked by near-term volatility – meaning we're solidly on track to achieve the targets we set for 2022," Kirby said.