Delta Air Lines Inc. expects to incur more than $2 billion in higher fuel costs through June because of the Iran war, prompting the carrier to tread carefully and stick to its previous full-year profit forecast.

Fuel prices have soared as the conflict disrupts global energy markets, raising costs for airlines at a time when demand has otherwise held up. The increase is forcing carriers to weigh how much of the higher expense they can pass on through fares without dampening bookings.

“High fuel prices have been the most powerful catalyst for change, separating the winners and forcing weaker players to rationalize, consolidate or be eliminated,” Chief Executive Officer Ed Bastian told analysts on an earnings conference call.

Bastian earlier told reporters Delta is “looking to do more” fare increases beyond what has already been levied.

Airline shares globally surged on April 8, after US President Donald Trump agreed to a two-week ceasefire in exchange for Tehran reopening the Strait of Hormuz, a vital route for exports of oil and other commodities.

Delta shares rose 7.2% to $70.32 as of 10:49 a.m. New York time on April 8. Rival United Airlines Holdings Inc. rose 11%, while American Airlines Group Inc. rose about 8%.

As the first major U.S. airline to report quarterly results, Delta is seen as a bellwether for the world’s biggest aviation market. Its lack of an updated full-year outlook highlights how volatile conditions have become for the industry.

Despite the uncertainty, Delta said bookings were strong generally across premium and corporate travel, as was peak summer and transatlantic demand, but it is seeing weaker “hotspots” in Europe and Mexico.

“The premium consumer is candidly immune, or becoming more immune, to the headlines,” Bastian added. 

Last quarter, Atlanta-based Delta said it expected its full-year earnings per share for 2026 to be in a range of $6.50 to $7.50.

“I’m not walking it back,” Bastian said of the forecast. “But as we gain more knowledge of the impact of the duration of the fuel spike over the course of the next couple of months, we’ll be in a better position to update it.”

The airline will make “some meaningful capacity reductions” — reaching about 3.5% — from the levels planned at the start of the quarter, he said. The affected flights would likely be in less-desirable travel periods such as overnight “red-eyes” and midweek.

The airline believes fuel prices will remain higher for a longer period, noting it was “too early” to discuss whether aircraft deliveries will be affected.

“We’re obviously going to be looking to save our capex and cash flow if this is going to be with us for an extended period of time this year,” he said.

Bastian’s comments obscured an otherwise upbeat quarterly earnings release, with premium cabin and loyalty-driven revenue cushioning the impact of higher fuel costs. 

Delta reported adjusted earnings of 64 cents a share, topping the 57 cents expected by analysts polled by Bloomberg. The company’s adjusted operating revenue of $14.2 billion also surpassed Wall Street’s expectations of about $14.08 billion.

Bastian said that while some sensitivity may exist at low-cost airlines serving price-conscious consumers, Delta’s premium-focused strategy is providing protection against the fuel price hikes.

“While much uncertainty remains, Delta is clearly among the best positioned to navigate through the current environment and is acting with urgency,” Raymond James analyst Savanthi Syth wrote in a note on April 8.

The company said last month that bookings were strong as people locked in lower fares with oil prices heading past $100 a barrel. Bastian said then the airline saw a $400 million spike in fuel costs just in the first two weeks of March.

The airline expects pretax profit of about $1 billion for the June quarter. It also forecast second-quarter revenue to grow in a “low teens” percentage range.

Delta joined other carriers in boosting fees on baggage to help offset rising costs, charging $10 more for the first and second checked bags on domestic and select international routes, while a third bag will cost $50 more.