High prices bumped U.S. airlines fuel costs to $38B in 2006

The horrible truth about airline fuel costs was made clear once again the other day when the Transportation Departments Bureau of Transportation Statistics posted the year-end tally for the U.S. airline industry.

The numbers are staggering: More than 19 billion gallons of fuel for the major national and large regional airlines, at a total cost of nearly $38 billion.

Contrast that with the industrys peak year, 2000, when the carriers used even more fuel, a tad over 20 billion gallons, but paid less than half of what they paid last year.

As shown in the accompanying charts, things started to get ugly in 2004 when the average price per gallon of fuel jumped to $1.15.

It got worse in 2005 when the per-gallon price averaged out to $1.66, a 44.3% increase that added nearly $10 billion in costs, boosting the total tab to $32 billion.

Smarting from the effects on their bottom lines, the airlines last year used about 0.13% less fuel than in 2005.

Still, they ended up paying nearly $6 billion more because prices kept rising, averaging $1.96 for the year.

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