<span>Story: American Airlines reported stronger-than-expected travel demand heading into spring on Tuesday, supporting fare increases and revenue growth.</span><span>This comes despite a spike in jet fuel prices related to the Iran war that has pushed up operating costs.</span><span>Airlines have begun to mitigate the impact through higher fares and capacity controls, executives said, arguing that if fuel prices continue to rise, the resilience of consumer and business demand will allow the industry to recoup at least some of the increases.</span><span>Shares of most U.S. airlines, including American Airlines, United Airlines and Delta Air Lines, were higher Tuesday morning following the new guidance. </span><span>Delta Air Lines CEO said at a conference on Tuesday that consumer and business demand accelerated into March, prompting the airline to raise its first-quarter revenue forecast while maintaining its profit forecast.</span><span>However, the company later said it had canceled some flights because of long wait times at transportation security checkpoints caused by the partial government shutdown.</span><span>Transportation Security Administration (TSA) managers told Fox News that a funding impasse could lead to the closure of some small airports in the coming weeks.</span><span>American Airlines also updated investors on Tuesday, saying its first-quarter revenue is expected to rise more than 10% on stronger-than-expected demand, up from its previous forecast of 7% to 10%.</span><span>The airline said it still expected an adjusted loss per share but now believed it was near the lower end of its previous guidance.</span><span>Jet fuel prices have soared since the U.S. and Israeli attacks on Iran in late February, leading to significant cost increases for the industry, where fuel expenditures are second only to labor and typically account for about 20% to 25% of total operating costs.</span><span>U.S. airlines are particularly at risk because most do not hedge fuel costs, unlike some European and Asian airlines that use hedging to cushion price shocks.</span><span>Still, Scandinavian airline SAS said on Tuesday it would cancel some flights in the short term, citing a “sudden and sharp increase in fuel prices.”</span><span>Delta Air Lines, meanwhile, said the industry has completed two fare increases in the past two weeks and remains in a good position to recoup high costs, with the flexibility to cut capacity if fuel prices remain high.</span>
