Mounting oil costs eroding airlines' profitability  Delta and Southwest Airlines are the latest carriers to project weaker earnings amid volatile energy prices.

The strategic sourcing of oil has become exceedingly important for airlines over the past few decades, as the price of a barrel of oil has ebbed and flowed, with geopolitical tensions and surging demand fueling price rises. Carriers have been incongruously impacted by soaring oil prices, with an uptick in oil costs eroding profit margins.

Bloomberg reports that Southwest recently projected it would post a loss during the first three months of this year. Delta, on the other hand, said it would likely earn less than it had formerly estimated, citing the burgeoning cost of oil. Delta has had to pay more than $250 million in unanticipated costs resulting from the spike in oil prices, according to the company's president, Ed Bastian.

"We not only expect fuel prices to stay high, but we expect they're going to continue to rise over the long term," he said at the JPMorgan Aviation Transportation and Defense Conference in New York.

Jet fuel has risen annually since 2008, according to Bloomberg data. While airlines have levied new fees and implemented cost reduction campaigns in an effort to bolster profitability, the latest jump in prices has hurt the effectiveness of such measures, experts say.
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