Surging jet fuel prices, driven by geopolitical tensions in the Middle East, represent the dominant force pressuring U.S. airline balance sheets and elevating bankruptcy risk through year-end. Low-cost carriers with thin margins and elevated debt loads face the sharpest headwinds, as fuel now accounts for roughly 30 percent of operating costs at elevated levels near $4.20 per gallon. Spirit Airlines’ recent liquidation following two Chapter 11 filings in under 18 months underscores how failed merger attempts, capacity cuts, and covenant defaults can accelerate outcomes when cash burn outpaces liquidity. Major network carriers maintain stronger free-cash-flow generation and hedging positions, keeping their implied probabilities of filing near historical lows. Traders are monitoring upcoming quarterly earnings releases and any further commodity volatility that could shift refinancing costs or trigger additional restructuring talks before December 31.