Airlines still pay less per gallon for fuel than people pay for spring water in a supermarket, at least in Europe. That seem ludicrous given the quality requirements and transportation distances. If you had something as valuable in your yard, would you want to sell it so cheaply? The answer is probably "yes" but only because you need to get cash now to buy other things - which is the same position the oil suppliers are in. The airline's problem is that when the oil price goes up, airline costs go up. Raising ticket prices will indeed turn off everyday Joe and make him travel less, so only some a price increase will translate into extra revenue. Some studies show that, for airlines as a whole, changes to prices (unless they are very large) don't do much for total revenue. A 5% price increase will translate into roughly a 5% traffic reduction. So airlines can only get their finances into balance by cutting other costs. Cutting the size of the operation is a start, but a lot of costs don't reduce proportionately. Aircraft in the desert still have to be paid for, for instance. And if,say UA cuts capacity at ORD, some traffic will spill to AA, unless AA is also cutting. And the law does not allow AA and UA to talk on the subject. So other suppliers, including labour, are put under pressure too. Some airlines can't cut back enough and go under, but that takes a very long time, especially when Chapter 11 is allowed/encouraged. These really leaves the airlines with high efficiency and reasonable fare levels (i.e. low break-even load factors) in the best position to survive. Airlines which already have high break-even load factors are in serious trouble. Antoin Daltun