A group of American air cargo carriers are lobbying the Trump administration to temporarily suspend federal excise taxes on commercial aviation fuel until market conditions stabilize and prices begin to decline.
The National Air Carrier Association (NACA), which includes air cargo giants including Amerijet and Atlas Air, shared the concern Monday amid jet fuel prices that have soared since the start of the war in Iran.
Traffic through the Strait of Hormuz, which harbors the transit of roughly 20 percent of the world’s oil and natural gas supply, has largely ground to a halt amid tensions in the region. The stalling of oil movement since the beginning of the Middle East conflict in late February has constrained global supply, ultimately putting upward pressure on prices.
In a statement, NACA president and CEO George Novak asserted that the increased fuel costs are an industrywide issue affecting U.S. cargo and passenger carriers alike, as well as charter operators, supplemental air carriers, regional airlines and commercial operators of all types and sizes.
“Ultimately, increased fuel costs ripple through the broader economy, increasing prices on everything transported by air,” said Novak. “From medical supplies and electronic components to flowers, perishables and consumer goods, everything becomes more expensive for American businesses and consumers.”
Carriers have experienced better news recently, with jet fuel prices having gone down five of the last six weeks, according to data from the International Air Transport Association (IATA) and Platts.
The global average jet fuel price as of May 15 fell 0.2 percent compared to the week before to $162.55 per barrel, and is down 22.2 percent from the 2026 peak on April 6 of $209 per barrel.
However, the numbers are still 63.5 percent above pre-war numbers on Feb. 27, when the weekly average price sat at $99.40 per barrel.
The subject of a gas tax suspension has been floated around Washington in an attempt to lower prices further.
Last week, President Donald Trump indicated he would support a federal non-aviation gas tax suspension, with Sen. Josh Hawley (R-Mo.) introducing the Gas Tax Suspension Act in the Senate to cut the tax rate on non-aviation gasoline and diesel fuel to zero for 90 days.
Rep. Jeff Van Drew (R-N.J.) introduced a similar bill in the House of Representatives that would include a suspension of the aviation gas tax, with that legislation eliminating the duty for 18 months.
The federal commercial jet fuel tax rate is 4.4 cents per gallon, while non-commercial jet fuel is 21.9 cents per gallon.
According to Novak, a suspension of the federal excise taxes would “provide immediate operational relief to carriers, help preserve critical air transportation capacity, support supply chain stability and help limit additional inflationary pressure on the American economy during a period of significant geopolitical uncertainty.”
E.U. airlines more positive on jet fuel supply
As U.S. airlines grapple with the costs, air carriers in Europe appear to be more positive on the supply environment than they were a month ago, when there were concerns that there would be fuel shortages by the end of May.
On Monday, Ryanair CEO Michael O’Leary said the airline has “almost zero concerns over fuel supplies across Europe,” which he said remains “very well supplied” with jet fuel. He noted that nearly all European jet fuel is now sourced from the Americas, Norway and West Africa since the pivot away from the Hormuz strait.
“Our fuel suppliers as recently as this week have confirmed they expect no supply disruption right out to the middle of July, and the situation continues to improve,” O’Leary said in an earnings call.
Earlier this month, British Airways and Iberia parent International Airlines Group (IAG) said “we are confident of jet fuel supply in our main markets throughout the summer. Today the situation is more about the price of fuel than availability.”
According to the European Commission, while there are no fuel shortages in the E.U. at present, regional supply constraints could arise in the coming weeks if the blockage of oil supplies via the Strait of Hormuz does not get resolved, with jet fuel being the primary concern. The commission said E.U. emergency stocks can be released if needed.
While parties across the E.U. and U.S. navigate the uneasy situation, India’s airline sector has its own concerns.
According to a Tuesday report from Bloomberg, Indian airlines including Air India, IndiGo and SpiceJet have asked state-run oil refiners to hold off on increasing jet fuel prices for domestic flights until the Iran War ends. India’s oil and gas ministry is also involved in the discussions, as part of a bid to alleviate their rising cost pressures and mounting losses.
