You ask a good question, one that I’m intrigued with as well (as I’m looking to book a flight to Europe for June, and prices have remained extraordinarily high).

I believe the answer is three-fold:

(1) the closer you get to your departure date, airlines generally raise prices. This is to discourage last-minute bookings. That said, there are exceptions where an airline might do a last-minute deal if it has seats still available… but generally the airlines don’t want people to wait until the last minute to book, so they raise prices at generally 60, 21, and 7-days before departure.

(2) curiously, the price of oil and gasoline are going down, not up; however the airlines cannot be completely sure this trend will remain, so they may be raising prices on the chance that summer oil prices will be higher. That said, Saudi Arabia recently publicly announced its commitment to keep oil prices low this year, so airlines should in fact be lowering their fuel taxes. They haven’t yet, and this is probably because they’re hoping most people aren’t picky about the price they pay, resulting in more profit for the airline.

(3) The cost of flights in general have been *very* high this year. I think the airlines are betting they can set a new level for prices if they work together. While this is not necessarily illegal or against anti-trust laws, other industries have tried similar tactics. Apple is famous for introducing new products (like their iPhone) at prices that may be much higher than similar products, however Apple hopes that demand will remain despite the high price, thus setting a new level for prices. Airlines may be trying the same thing, and if they don’t succeed, then they’ll lower their prices in Feb or March.

I’ve noticed on several summer flights to Europe (the peak travel period) that the plane is almost 90% empty at the moment. So demand really hasn’t kept up with the high prices, so I’ll be interested to see if prices drop later in February or March. Airlines are betting some people will book now, for piece of mind, even if prices are high.

Its because they can keep the fares up. In the past they used to go down after the holidays, but thats a thing of the past. Your lucky if you catch a good deal these days. When I book tickets, I always get them directly from the airlines themselves. I find other sites charge too much as far as taxes and extra fees. There are no hidden fees when you buy directly from the airlines. Also, you can keep checking their sites cause the prices can change a few times a day. The closer you get to the day you want to travel, the higher up the prices go. Thats my suggestion. You can also check these sites out and see if theres anything……….

the reason airfare is so expensive is because fuel is so expensive and it takes a lot of fuel to get you from poit a to point b