Surging jet fuel prices, now exceeding $4 per gallon amid the Iran conflict, represent the dominant driver pressuring U.S. low-cost carriers and elevating implied bankruptcy probabilities on prediction markets. Spirit Airlines completed its wind-down in early May after its second Chapter 11 exit plan collapsed under doubled fuel costs and failed $500 million rescue financing, illustrating how thin margins and elevated debt amplify vulnerability. JetBlue faces $755 million in 2026 debt maturities alongside projected $1.3 billion losses at current fuel levels, while Frontier contends with widening losses and lease obligations that analysts flag as elevating default risk above 45 percent. In contrast, major carriers like Delta and United maintain stronger free-cash-flow positions and diversified international revenue, cushioning the impact. Q2 earnings releases and any moderation in crude benchmarks will likely determine whether these pressures intensify or ease before year-end.