Falling Oil Prices, a Boon to Airlines, Pose a Challenge for Airbus and Boeing

Falling Oil Prices, a Boon to Airlines, Pose a Challenge for Airbus and Boeing

"What has propelled the market to record growth are two factors: cheap cash and expensive fuel," said Richard Aboulafia, an aerospace analyst with the Teal Group in suburban Washington. "Now something has changed."

Whether the continued fall in price of oil represents something more significant than a short-term imbalance of global supply and demand remains to be seen, some analysts warn. But if it continues, airlines would be motivated to keep their older, fuel-guzzling jets flying for a few more years and delay new orders in hopes of saving money.

"We can't yet predict if it will last or how the air carriers will react," Mr. Aboulafia said, "but I think now would be an excellent time for caution."

Tags Airlines, Fuel Costs, Oil Prices Media Outlet: The New York Times Featured Analyst Richard L. Aboulafia

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