Tonya Ruhsenberger paid $98 to fill her SUV with midgrade gas this week, a reminder of how the war in Iran has driven fuel costs on the ground at home.
The strain also is in the air.
As communications manager for Denver Air Connection, which provides essential flights out of Cortez and other small towns, she has watched jet fuel prices, which have nearly doubled since the conflict began.
“We are doing our best to rein in our internal costs and see where we can tighten up our belts a little bit so we don't have to pass that on to the passenger,” Ruhsenberger said. “But there will be some costs that are going to go up”
Even as Iran begins to open the Strait of Hormuz to oil tankers, high jet fuel prices are prompting Denver Air Connection to raise prices over the next few weeks. Starting May 1, the airline will raise bag fees for all flights by $5. At the Cortez Municipal Airport, which provides flights to Denver and Phoenix, plane tickets will increase by $30 starting next week.
Ruhsenberger said the company is looking into low-cost marketing alternatives to cut costs and lessen the impact of jet fuel prices on customers, whose air service connection to larger cities is vital.
“We know that a lot of the areas we fly into are rural areas, and some of them have fairly low median household incomes,” Ruhsenberger said. “When folks have to get to a doctor’s appointment, they have family that might have had a bad situation, a baby being born, marriage, anything like that, they need to get on our airplane. And we realize that cost is a big part of that.”
While the U.S. and Iran negotiate, the Strait of Hormuz, through which one-fifth of the world’s oil supply normally passes, has seen reduced traffic. The impact from its partial closure is still trickling down to fuel-reliant industries, including trucking companies and flight providers, in Southwest Colorado.
Tylor Holaday, owner of Tylor Holaday Trucking, a Cortez family business offering various hauling services, said he has had to raise prices significantly for customers, driving some away.
“We’ve gone up a good 15%,” Holaday said. “It’s definitely slowed down business a lot.”
Compared with what customers paid three months ago, the cost is now at least $1,000 more, Holaday said, a trend he said is reflected across the region. Montezuma County averaged $4 per gallon of gas Thursday. According to GasBuddy’s weekly report released Monday, state gas prices are up 43.2 cents per gallon from last month, and diesel prices continue to climb. The state is averaging more than $5 per gallon of diesel.
“It’s going to make it hard on quite a few trucking companies,” Holaday said.
Despite the slow reopening of the Strait of Hormuz, Holaday said he does not expect prices to drop quickly.
“I don’t see it coming down as fast as I’d like it to,” Holaday said.
Ruhsenberger agreed, saying based on airline market trends, the return to normal fuel costs will take time.
“It is going to be a longer timeline,” Ruhsenberger said. “I’ll be honest as the marketing person and somebody who looks at our stations and our passengers: Economic uncertainty is one of the things that’s super-high right now.”
So far, demand for Denver Air Connection flights has not dropped significantly, but Ruhsenberger said April numbers will be telling, particularly for flights to and from Cortez, the company’s strongest market.
“When people are afraid that they’re not going to be able to afford their day-to-day necessities, they’re not going to be flying on airplanes and taking those trips,” Ruhsenberger said. “So we are watching very closely how much traffic we lose this summer compared with last summer due to rising costs and economic uncertainty.”
avanderveen@the-journal.com
