United Airlines and American Airlines signal potential capacity cuts as elevated fuel costs driven by the war in Iran pressure margins. Both carriers are adjusting schedules to prioritize profitability over market share.

United Airlines Chief Financial Officer Michael Leskinen described fourth-quarter bookings as "tremendously strong" during a presentation at the Morgan Stanley conference. However, he noted that some marginal routes do not make sense in a higher fuel environment. The airline has already cut some routes scheduled for December and may make further adjustments into the first quarter and beyond into 2027 if fuel costs remain elevated.

Operational Strategy

Leskinen emphasized a philosophy of driving profitability rather than maintaining market share. He stated that every airline has a bell curve of profitability and that United adjusts its schedule when the world changes. Some routes were pushed to the lower end of profitability as fuel costs spiked, prompting preemptive cuts. Management did not specify the exact number of flights or routes under review for the upcoming quarters.

American Airlines Perspective

American Airlines CFO Devon May also pointed to capacity adjustments for late in the fourth quarter given fuel conditions. CEO Robert Isom highlighted the crack spread, which is the profit margin refineries earn for refining crude oil into fuel. Isom noted that the crack spread has grown by 3x, complicating the cost structure beyond just crude oil prices.

According to an International Air Transport Association report on September 11, the average jet fuel crack spread was at $67.80/bbl, lower than the previous week’s $74.17/bbl. Isom outlined that fuel costs had climbed by $1 billion for the fourth quarter. He also pointed to American Airlines’ third-quarter revenue growth, expected to be around 16% to 19% year over year, describing it as durable.

Market Context

Fuel remains a significant variable cost for global carriers. The remarks from both airlines highlight the ongoing pressure to balance robust demand with rising operational inputs. While United focuses on cutting unprofitable routes, American Airlines points to refinery margins as a key cost driver alongside crude prices.

United Airlines and Neste have extended their agreement to supply sustainable aviation fuel (SAF) blended with conventional jet fuel for flights departing from Chicago O’Hare International Airport and Amsterdam Airport Schiphol.

The extension underscores the strategic collaboration between the two entities to reduce greenhouse gas (GHG) emissions through scalable SAF deployment. Under the renewed terms, Neste will continue supplying Neste MY Sustainable Aviation Fuel™.

Supply Timeline And Locations

The contract specifies distinct delivery windows for each hub. Neste’s SAF deliveries to United at Amsterdam began in June 2026 and are scheduled to continue through August 2026. For Chicago O’Hare, deliveries started in July 2026 and are planned to run until June 2027.

Scaling SAF Usage

United reported using over 83,000 metric tons (roughly 27.7 million gallons) of SAF in 2025. This volume represents a 104% increase over the prior year, positioning United as the largest SAF user among major U.S. airlines based on publicly available reports.

The airline expanded SAF usage to three additional hub airports: Newark, Washington D.C., and Houston. This expansion brings SAF usage to six out of United’s seven domestic hubs. Chicago O’Hare remains a critical node for this strategy; it is United’s largest hub by daily departures and among its most important global gateways. United was the first airline to purchase and use blended SAF at O’Hare in August 2024.

In Amsterdam, United has utilized Neste MY SAF at Schiphol Airport since 2022. The carrier was the first airline globally to use SAF in ongoing operations.

What The Numbers Show

United’s SAF consumption more than doubled year-over-year in 2025, rising 104% to over 83,000 metric tons. This rapid volume expansion coincides with geographic scaling, as the airline extended SAF availability to three new domestic hubs, covering six of its seven total domestic locations. The data indicates that United is shifting from pilot-scale adoption at single hubs like Chicago O’Hare to broad-based operational integration across its network.

Lauren Riley, Chief Sustainability Officer at United Airlines, stated that continuing work with Neste across two continents reflects a shared conviction that SAF is available and capable of being scalable. United aims to reach net-zero emissions by 2050, leveraging SAF and other measures to reduce GHG emissions.