High jet fuel prices, driven by Middle East supply disruptions and WTI crude above $90 per barrel, represent the dominant pressure on airline margins heading into summer 2026. Carriers with thinner balance sheets and limited pricing power face the steepest challenges: JetBlue’s founder recently highlighted projected 2026 losses exceeding $1 billion under $4.50-per-gallon fuel assumptions, pushing leverage toward $9 billion, while analysts assign Frontier a 45–50% probability of default by 2027 and Allegiant roughly 37%. Spirit Airlines, already in its second Chapter 11 restructuring since 2024, continues burning cash and is expected to exit with sharply reduced capacity. Larger network carriers such as American, Delta, and United have lowered net debt and extended liquidity, yet still guide for narrower 2026 earnings ranges as fuel hedges roll off. Key near-term catalysts include Q2 earnings releases, any sustained oil-price spike, and potential regulatory or merger-related developments that could alter competitive dynamics before year-end.