United Airlines joins JetBlue in raising checked bag fees. How much more will it cost?

For the second time in less than a week, a major U.S. airline is raising its fees for checked bags amid the war in the Middle East that has disrupted oil supplies and led to a spike in fuel prices.

United Airlines announced that starting Friday, most passengers will pay $10 more to check luggage. Customers traveling in the United States, Mexico, Canada and Latin America will now pay $45 for their first piece of luggage and $55 for their second bag, according to United.

“This is the first time in two years the airline has raised bag fees,” United said in a statement.

Some passengers will still receive a free first checked bag, including co-branded credit card holders, certain loyalty-tier members, active military personnel and travelers in premium cabins. Customers who check bags less than 24 hours before departure will pay an additional $5.

United joins JetBlue, which raised checked baggage fees on Monday by up to $9 during peak travel periods, as the war in the Middle East continues to severely disrupt global oil supplies, particularly near the narrow Strait of Hormuz where a fifth of the world’s oil typically passes. That has caused crude prices to fluctuate wildly, which affects airlines’ operating costs because the fuel their aircraft rely on is refined from crude oil.

Airspace closures in parts of the Middle East have added to the price pressure by forcing some airlines to take longer routes that burn more fuel.

JetBlue said charging more for optional services used by select customers helps keep base fares competitive. Like United, it will continue offering a free first checked bag to some customers.

For most domestic economy passengers for JetBlue, the first checked bag now costs $39, up from $35. During peak travel times such as April spring breaks, major holidays and the summer, passengers will have to pay $49 instead of $40, the airline said.

JetBlue also increased the charge to check a second bag from $50 to $59 for off-peak periods, and from $60 to $69 for periods of peak demand.

“While we recognize that fee increases are never ideal, we take careful consideration to ensure these changes are implemented only when necessary,” JetBlue said.

The carrier said some customers would still be able to check their first bag for free, including those who hold one of the airline’s co-branded credit cards and loyalty program members who reach certain tiers. Most customers flying transatlantic routes will also continue to receive their first checked bag free.

Airlines around the world are confronting soaring operating expenses due to jet fuel prices that have jumped more than 85% since the conflict began on Feb. 28. At that time, the average price for a gallon of jet fuel in Chicago, Houston, Los Angeles and New York were $2.50, according to Argus Media; on Thursday, the average price had reached $4.88. The energy market intelligence company’s U.S. Jet Fuel Index tracks the average prices across those major hubs.

Speaking to investors last month at a conference, United CEO Scott Kirby said the higher jet fuel costs had already added roughly $400 million to operating costs. The CEOs for Delta Air Lines and American Airlines reported similar figures.

Fuel is typically the second biggest expense for airlines after labor. Analysts expect U.S. airlines to pass higher fuel costs on to travelers by increasing add-on fees or ticket prices since they don’t usually have fuel surcharges, while a number of non-U.S. carriers already have added fuel surcharges.

Planning on checking a bag at the airport? Here’s how to avoid the extra baggage fees. 

One reason why U.S. airlines prefer to raise the prices on ancillary fees like baggage instead of adding a fuel surcharge to the ticket price is because of a little known tax loophole.

Airlines have to pay a 7.5% federal excise transportation tax on base airfare for domestic flights. However, the law specifically excludes baggage and seat selection fees from the tax, as long as “the charge is separable from the payment for the transportation of a person and is shown in the exact amount.”

If an airline were to charge $300 for a round-trip ticket that combined airfare and baggage fees, it would have to pay the government $22.50 in taxes. But if the airline only charges the customer $220 for airfare, and then separately charges a baggage fee of $40 each way, then their tax bill would be $16.50.

Iran’s determination to close off the Strait of Hormuz to ships from nations it considers unfriendly has caused crude oil prices to fluctuate wildly and in turn, driven up fuel prices. Earlier this month, the CEOs of Delta Airlines, American Airlines and United Airlines reported that higher jet fuel prices had already added about $400 million in operating costs.