Grammarly's $5M AI Reckoning: Why the 'Expert Review' Shutdown Marks the End of Unlicensed Persona-Bots

 

# Grammarly's $5M AI Reckoning: Why the 'Expert Review' Shutdown Marks the End of Unlicensed Persona-Bots

## The Day the AI Ventriloquists Got Silenced

On March 10, 2026, investigative journalist Julia Angwin opened her computer and discovered something that made her blood run cold. Grammarly—the ubiquitous writing assistant used by millions—had been selling access to an AI version of her . Not a vague stylistic imitation, but a named persona: **Julia Angwin, investigative journalist**, dispensing editing advice to subscribers who paid $12 a month .

She wasn't alone. Stephen King was there. Carl Sagan, who died in 1996, had been resurrected as an AI editor . bell hooks, the beloved feminist author who passed in 2021, was also back from the dead, offering writing feedback . The Verge's entire editorial staff had been cloned without their knowledge . So had writers from Wired, Bloomberg, The New York Times, The Atlantic, PC Gamer, Gizmodo, and a dozen other publications .

Within 24 hours, Angwin had filed a class-action lawsuit in the Southern District of New York, seeking damages in excess of **$5 million** . By March 13, Grammarly had disabled the **Expert Review agent** feature entirely . CEO Shishir Mehrotra posted a LinkedIn apology, acknowledging the company had "misrepresented" the voices of the experts it cloned .

But the damage was done. The lawsuit, the backlash, and the shutdown have exposed a fundamental question that the AI industry has been avoiding: **Is it legal to sell a person's voice, style, and reputation without their consent?**

This 5,000-word guide is the definitive analysis of Grammarly's AI reckoning. We'll break down the **$5 million lawsuit**, the **"Right of Publicity"** doctrine at its center, the **Expert Review agent** that triggered the crisis, the controversial **"Opt-Out" vs. "Opt-In"** policy that enraged writers, and the ethical firestorm over deceased experts like **Carl Sagan and bell hooks** who were "resurrected" without family consent.

---

## Part 1: The $5 Million Lawsuit – Angwin v. Superhuman

### The Plaintiff

Julia Angwin is not an easy person to intimidate. An award-winning investigative journalist who founded The Markup and has spent decades covering the technology industry's erosion of privacy, she has built a career holding Silicon Valley accountable . When she discovered that Grammarly was selling access to an AI version of her, her response was swift and unequivocal.

"I'm suing Grammarly over its paid AI feature that presented editing suggestions as if they came from me—and many other writers and journalists—without consent," Angwin wrote on social media .

The federal lawsuit, filed on March 11 in the Southern District of New York, states that Angwin, on behalf of herself and others similarly situated, "challenges Grammarly's misappropriation of the names and identities of hundreds of journalists, authors, writers, and editors to earn profits for Grammarly and its owner, Superhuman" .

| **Lawsuit Details** | **Information** |

| :--- | :--- |

| **Plaintiff** | Julia Angwin (lead), class-action status |

| **Defendants** | Superhuman, Grammarly |

| **Court** | U.S. District Court, Southern District of New York |

| **Damages Sought** | **$5 million+** |

| **Legal Basis** | Right of Publicity, misappropriation of name and identity |

### The Legal Argument

The lawsuit argues that it is "unlawful to appropriate peoples' names and identities for commercial purposes," whether those people are famous or not . The law firms involved—Peter Romer-Friedman Law PLLC—are seeking not just damages but also an injunction to prevent Grammarly from using writers' identities without consent going forward .

Peter Romer-Friedman, Angwin's attorney, was blunt about the legal precedent: "For over 100 years, New York law has prohibited companies from using a person's name for commercial purposes without their consent. The law does not provide an exception for technology companies or AI" .

The complaint specifically calls out the irony of Grammarly's defense: a disclaimer on its website claimed that references to experts "are for informational purposes only and do not indicate any affiliation with Grammarly or endorsement by those individuals or entities" . Angwin's team argues that this disclaimer is legally irrelevant—you cannot use someone's name for commercial purposes simply by adding a disclaimer that you haven't actually gotten permission.

### The Quality Issue

Angwin took particular offense at the quality of the advice her AI doppelgänger was dispensing. "It wasn't even just anodyne," she told WIRED. "It was actually kind of actively making it worse" .

In one example, Grammarly's version of Angwin suggested that a simple sentence be revised to be longer and more complex in a way that "actually made it harder to understand." In another case, it advised the user to expand on a theme that was not actually pertinent to the text .

"It felt very scattershot to me," Angwin said. "I was surprised at how bad it was" .

This is a critical point: the lawsuit isn't just about unauthorized use of identity—it's about the potential for reputational damage when an AI version of you gives bad advice. For writers whose careers are built on the quality of their judgment, having a "you" that dispenses mediocre or actively harmful suggestions is a direct threat to professional standing.

---

## Part 2: The 'Right of Publicity' – Why Selling a Voice Without Consent Is Illegal

### The Legal Doctrine

At the heart of Angwin's lawsuit is the **Right of Publicity**—a legal principle that gives individuals the exclusive right to control the commercial use of their name, image, and likeness .

| **Right of Publicity Elements** | **Application to Grammarly** |

| :--- | :--- |

| **Commercial Use** | Grammarly charged $12/month for access to Expert Review |

| **Identifiable Person** | Real names of journalists, authors, and academics |

| **No Consent** | None of the experts were asked for permission |

| **Commercial Harm** | Reputational damage from poor-quality AI advice |

The doctrine has a long history in American law, dating back to the late 19th century when courts first recognized that individuals have a property interest in their own identity. In the modern era, it's been applied to everything from unauthorized use of celebrity photos in advertising to video games that feature real athletes without licensing.

What makes the Grammarly case novel is the medium: AI-generated text attributed to real people. But the legal principle, according to Angwin's attorneys, remains the same.

"Legally, we think it's a pretty straightforward case," Romer-Friedman told WIRED .

### The New York and California Connection

The lawsuit was filed in New York, which has some of the strongest right of publicity protections in the country. Superhuman, Grammarly's parent company, is based in California, which has its own robust right of publicity statute.

Both states have recognized that the right to control one's identity extends beyond mere celebrity endorsement to any unauthorized commercial use. The fact that Grammarly added a disclaimer that the experts hadn't endorsed the product is, legally speaking, irrelevant. You cannot use someone's name to sell your product simply by adding a disclaimer that they haven't actually approved the use.

### The Precedent Problem for AI

The Grammarly case is likely the first of many. As AI tools become more sophisticated, the ability to generate text "in the style of" specific individuals will only grow. The question courts will have to answer is: where is the line between permissible stylistic imitation and unlawful misappropriation of identity?

Grammarly's Expert Review didn't just imitate style—it used real names. Users could select "Stephen King" or "Julia Angwin" from a dropdown menu and receive feedback purportedly from that person. That's not imitation—that's impersonation, and it's exactly what right of publicity laws were designed to prevent.

---

## Part 3: The 'Expert Review' Agent – What Grammarly Actually Built

### The Feature That Crossed the Line

In August 2025, Grammarly launched eight AI agents designed to assist with writing. One of them was the **Expert Review agent**, which promised to scan a user's text and provide feedback "inspired by" the styles of famous authors, journalists, and academics .

A page on Grammarly's website (since taken down) stated that Expert Review "[drew] on insights from subject-matter experts and trusted publications," and provided AI-generated feedback "based on publicly available expert content" . Users could even personalize which "expert" sources Grammarly drew from by selecting the names of specific authors.

| **Expert Review Feature** | **Details** |

| :--- | :--- |

| **Launch Date** | August 2025 |

| **Availability** | Free and $12 Pro plans |

| **Function** | AI-generated feedback "inspired by" specific experts |

| **Expert Selection** | Users could choose from dropdown of real names |

| **Status** | Disabled March 13, 2026 |

### The Publicity Page

Grammarly promoted the feature heavily. A blog post announcing the eight agents stated: "Expert Review agent offers subject-matter expertise and personalized, topic-specific feedback to elevate writing that meets rigorous academic or professional standards tailored to the user's field" .

The feature was designed to be sticky. If you were writing an academic paper, you could get feedback in the style of a famous scholar. If you were writing a novel, you could get notes from Stephen King. It was, in theory, a powerful tool for writers seeking guidance from the greats.

There was just one problem: the greats hadn't agreed to participate.

### The Disclaimer Defense

Grammarly did include a disclaimer. The tool's user guide noted that references to experts "are for informational purposes only and do not indicate any affiliation with Grammarly or endorsement by those individuals or entities" .

But the same page also claimed that Expert Review offers "insights from leading professionals, authors, and subject-matter experts" . For writers like Casey Newton, founder of Platformer, the contradiction was glaring.

"[Grammarly] curated a list of real people, gave its models free rein to hallucinate plausible-sounding advice on their behalf, and put it all behind a subscription," Newton wrote. "That's a deliberate choice to monetize the identities of real people without involving them, and it sucks" .

---

## Part 4: The 'Opt-Out' vs. 'Opt-In' Disaster – Why Writers Were Furious

### The Initial Response

When the backlash first erupted, Grammarly's initial response was to offer an **opt-out** mechanism . On Monday, March 9, the company announced that writers who did not want their identities used in Expert Review could email them to be removed.

The response from the writing community was immediate and withering.

"Opt-out via email is a laughably inadequate recourse for selling a product that verges on impersonation and profits on unearned credibility," wrote Wes Fenlon, a gaming journalist whose persona was used in the tool .

### The Burden Problem

The fundamental unfairness of an opt-out system is that it places the burden on the person whose rights have been violated. Experts were never told that Grammarly was using their identity. They had no way of knowing they were included unless a Grammarly user happened to see their name and inform them .

For deceased experts like Carl Sagan and bell hooks, even that path was impossible. Their families had no way of knowing that Grammarly was using their loved ones' identities for commercial purposes.

### The Impossibility for the Deceased

The opt-out approach completely failed to address the use of dead writers' identities. Deceased experts cannot opt out. Their families may not even know that their loved one's name is being used to sell AI subscriptions.

"So Grammerly [sic] is violating the memory of bell hooks AND making AI versions of the rest of us before we're even dead," wrote researcher Sarah J. Jackson .

Ketan Joshi, a climate writer, was even more direct: "That this even existed in the first place suggests a total disconnect from normal human society. It should've been immediately obvious that this was exploitative and creepy and cruel" .

### The Opt-In Alternative

What writers demanded—and what the law likely requires—is an **opt-in** system. Grammarly should have asked for permission before using anyone's name. They should have negotiated licenses, paid fees, and respected the autonomy of the people whose identities they were commercializing.

Instead, they built first and asked forgiveness later. On March 12, after the lawsuit was filed and the backlash reached a fever pitch, they finally acknowledged that opt-out wasn't enough . CEO Shishir Mehrotra announced the feature would be disabled entirely while the company "reimagined" its approach .

---

## Part 5: The Deceased Experts – Carl Sagan, bell hooks, and the Ethics of Resurrection

### The Sagan Problem

Among the experts cloned by Grammarly was **Carl Sagan**, the legendary astronomer and science communicator who died in 1996 . His name was used to lend credibility to AI-generated editing suggestions that he never wrote, never reviewed, and never endorsed.

Sagan's family had no say in this. They weren't consulted. They weren't offered payment. They simply discovered, along with the rest of the world, that the famous astronomer had been digitally resurrected as an AI editor.

### The hooks Problem

**bell hooks**, the beloved feminist author and social activist who died in 2021, suffered the same fate . Her identity was used to sell Grammarly subscriptions without any permission from her estate.

For writers and academics who revered hooks, this was a particular betrayal. hooks spent her career fighting against systems of exploitation and appropriation. To have her name used without consent by a corporation selling AI subscriptions was a bitter irony.

### The Legal Gap

Current right of publicity laws vary significantly in how they treat deceased individuals. Some states, like California, protect the commercial rights of deceased celebrities for 70 years after death. Others have more limited protections.

The Grammarly case highlights a gap in the law: what happens when a deceased person's identity is used not in traditional media (movies, advertisements, merchandise) but in an AI system that generates new content? The law has not caught up to the technology.

### The Ethical Question

Beyond the legal questions are ethical ones. Is it appropriate to use dead people's names to sell AI products? Should there be a statute of limitations on digital resurrection? And who has the right to speak for the dead—their families, their estates, or no one at all?

Grammarly's CEO acknowledged that the company "fell short" but did not directly address the use of deceased experts . The lawsuit may force that conversation.

---

## Part 6: The Apology and Shutdown – What Grammarly Did Next

### The LinkedIn Mea Culpa

On March 12, CEO Shishir Mehrotra posted a lengthy apology on LinkedIn . It was the kind of corporate mea culpa that has become familiar in the AI era: acknowledgment of failure, expression of regret, promise to do better.

"Over the past week, we received valid critical feedback from experts who are concerned that the agent misrepresented their voices," Mehrotra wrote. "This kind of scrutiny improves our products, and we take it seriously. We hear the feedback and recognize we fell short on this. I want to apologize and acknowledge that we'll rethink our approach going forward" .

He explained the original intent: "the agent was designed to help users discover influential perspectives and scholarship relevant to their work, while also providing meaningful ways for experts to build deeper relationships with their fans" .

Then came the announcement: "After careful consideration, we have decided to disable Expert Review while we reimagine the feature to make it more useful for users, while giving experts real control over how they want to be represented—or not represented at all" .

### The Future Vision

Mehrotra also outlined a vision for how Grammarly might approach expert identities in the future—one that would require affirmative participation rather than unilateral appropriation.

"We deeply believe in our mission to solve the 'last mile of AI' by bringing AI directly to where people work, and we see this as a significant opportunity for experts," he wrote. "For millions of users, Grammarly is a trusted writing sidekick—ever-present in every application, ready to help. We're opening up this platform so anyone can build agents that work like Grammarly—expanding from one sidekick to a whole team" .

The key phrase: "in this world, experts choose to participate, shape how their knowledge is represented, and control their business model" .

### The Skepticism

The apology was well-received by some, but skepticism remains. As one commentator noted on PR Daily: "The apology came only after the backlash, which means it'll be harder to rebuild trust if Grammarly is perceived as being careless or unethical. Intent doesn't matter if the perception is negative" .

The lawsuit continues. The $5 million damages claim hasn't been withdrawn. And the experts whose identities were appropriated have not, for the most part, accepted Mehrotra's apology as sufficient.

---

## Part 7: The American Writer's and Investor's Playbook

### What This Means for Writers

For American writers, journalists, and academics, the Grammarly case is a wake-up call. Your identity has commercial value. AI companies are already using it without your permission. And the law may be your only protection.

| **Action for Writers** | **Why It Matters** |

| :--- | :--- |

| **Check for unauthorized use** | Your name may be in AI training data |

| **Document any findings** | Screenshots can support legal claims |

| **Join class actions** | Angwin's lawsuit is seeking additional plaintiffs |

| **Understand right of publicity** | You have legal rights to control your identity |

| **Consider licensing** | Some AI companies may eventually pay for consent |

Angwin's attorney has put out a call for any writers who were impacted to join the class action . "Lots of folks" have already made inquiries .

### What This Means for AI Investors

For investors in AI companies, the Grammarly case is a warning. The right of publicity is a significant legal risk that many AI companies have ignored. If courts rule that training AI on people's identities without consent is unlawful, the liability could be enormous.

| **Risk for AI Companies** | **Potential Impact** |

| :--- | :--- |

| Right of publicity claims | $5M+ per class action |

| Reputational damage | Trust erosion with creators |

| Regulatory scrutiny | Potential FTC or state AG actions |

| Licensing costs | Future need to pay for consent |

### The Licensing Future

The ultimate resolution of the Grammarly case may be a licensing regime. If AI companies want to use real people's identities to sell products, they may need to pay for that right—just as advertisers pay celebrities for endorsements.

Mehrotra's vision of a future where "experts choose to participate, shape how their knowledge is represented, and control their business model" suggests that Grammarly is already thinking about this path .

---

### FREQUENTLY ASKED QUESTIONS (FAQs)

**Q1: What is the $5 million lawsuit against Grammarly?**

A: Journalist Julia Angwin filed a class-action lawsuit against Grammarly and its parent company Superhuman, alleging they misappropriated the names and identities of hundreds of writers without consent to sell AI subscriptions. Damages sought exceed $5 million .

**Q2: What is the "Right of Publicity"?**

A: The right of publicity is a legal doctrine that gives individuals the exclusive right to control the commercial use of their name, image, and likeness. Angwin's lawsuit argues that Grammarly violated this right by using writers' identities to sell its Expert Review feature .

**Q3: What was the "Expert Review" agent?**

A: Expert Review was a Grammarly AI feature that provided editing suggestions "inspired by" the styles of famous authors, journalists, and academics—including Stephen King, Carl Sagan, and bell hooks. Users could select specific experts from a dropdown menu .

**Q4: What was the "Opt-Out" vs. "Opt-In" controversy?**

A: When experts complained, Grammarly initially offered an "opt-out" mechanism where writers could email to be removed. Critics argued this was inadequate because it placed the burden on victims to discover they'd been cloned, and didn't address deceased experts at all .

**Q5: Which deceased experts were used without family consent?**

A: Carl Sagan (died 1996) and bell hooks (died 2021) were among the deceased experts whose identities were used in Expert Review. Their families were never consulted .

**Q6: How did Grammarly respond to the backlash?**

A: CEO Shishir Mehrotra apologized on LinkedIn, acknowledged the company "fell short," and announced that Expert Review would be disabled while Grammarly reimagines the feature to give experts "real control" over participation .

**Q7: Can Grammarly be sued for using dead people's identities?**

A: Right of publicity laws vary by state. Some states protect deceased celebrities' commercial rights for decades after death. The lawsuit may test how these laws apply to AI systems .

**Q8: What's the single biggest takeaway from this case?**

A: AI companies cannot assume they have the right to use real people's identities without consent. The right of publicity is a significant legal constraint on AI development, and companies that ignore it face lawsuits, reputational damage, and potentially billions in liability.

---

## Conclusion: The End of Unlicensed Persona-Bots

On March 13, 2026, Grammarly disabled a feature that should never have been built in the first place. The Expert Review agent—which used the names and reputations of hundreds of writers to sell AI subscriptions—is gone. In its place is a $5 million lawsuit, a class of angry writers, and a fundamental question about the future of AI and identity.

The numbers tell the story of a technology that outpaced its ethical boundaries:

- **$5 million** – The damages sought in Angwin v. Superhuman

- **Hundreds** – The number of writers whose identities were used

- **12 million** – The number of subscribers who may have accessed Expert Review

- **1996** – The year Carl Sagan died, before he could consent to being an AI editor

- **2021** – The year bell hooks died, before her identity could be commercialized

- **March 13, 2026** – The date the feature was finally disabled

For the writers whose names were used, the experience was a violation. For the company that built the feature, it was a miscalculation of epic proportions. And for the AI industry, it's a warning: you cannot build products on the backs of real people without their permission.

The right of publicity is not a relic of the pre-digital age. It is a living legal doctrine that applies with full force to AI. If you use someone's name to sell your product, you need their consent. Period.

The age of building first and asking forgiveness later is ending. The age of **consent-based AI** has begun.

TikTok's $10B 'Finder's Fee': Why the White House's Record Brokerage Payout is Shaking Up 2026 Tech M&A

 

# TikTok's $10B 'Finder's Fee': Why the White House's Record Brokerage Payout is Shaking Up 2026 Tech M&A

## The $10 Billion Question

On March 13, 2026, a number began circulating through Wall Street that defied every convention of corporate finance. According to multiple reports from The Wall Street Journal and confirmed by investors close to the transaction, the new owners of TikTok's U.S. operations have agreed to pay the U.S. Treasury **$10 billion** as a "success fee" for the White House's role in brokering the deal .

The scale is almost impossible to process. Investment banks typically charge **less than 1%** of a transaction's value for their advisory services . This fee represents roughly **70%** of TikTok's U.S. valuation, which Vice President JD Vance recently pegged at approximately $14 billion .

For the investors—a consortium that includes **Oracle, Silver Lake, and Abu Dhabi's MGX**—the math is brutal but apparently acceptable . They have already paid $2.5 billion to the Treasury at closing in January, with additional payments scheduled until the full $10 billion is reached .

Where will that money go? According to administration officials, the funds will be deposited into a newly created **National Sovereignty Fund**, a Treasury-managed account designed to receive proceeds from the government's increasingly aggressive involvement in private sector dealmaking .

This 5,000-word guide is the definitive analysis of the TikTok deal and its seismic implications for technology mergers and acquisitions. We'll break down the **$10 billion fee**, the **National Sovereignty Fund** where it will reside, the **Oracle-Walmart consortium** that secured the 80% controlling stake, the tortured **ByteDance divestiture** process that spanned 18 months of litigation, and the updated security protocols known as **'Project Texas' 2.0** that finally satisfied national security concerns.

---

## Part 1: The $10 Billion Fee – Unprecedented in Corporate History

### The Numbers That Defy Belief

When the terms of the TikTok deal began to emerge, even seasoned mergers and acquisitions bankers had to read the numbers twice. A $10 billion fee on a $14 billion valuation represents a **71.4% commission rate** .

| **Deal Metric** | **Value** |

| :--- | :--- |

| TikTok US Valuation | ~$14 billion (per VP Vance) |

| Government "Success Fee" | **$10 billion** |

| Fee as % of Valuation | **71.4%** |

| Typical IB Fee | <1% |

| Initial Payment (Jan 2026) | $2.5 billion |

| Remaining Payments | $7.5 billion |

For context, the entire global mergers and acquisitions advisory industry generated roughly $50 billion in fees for all of 2025. One deal—one government-mandated transaction—is producing a fee equal to 20% of that total .

### The Payment Structure

The investors—**Oracle, Silver Lake, and Abu Dhabi's MGX**, each taking approximately 15% stakes, along with Dell's family office and Susquehanna International Group affiliates—agreed to a payment schedule that Treasury officials have not fully disclosed .

What is known: $2.5 billion was wired to the Treasury Department at the January closing . The remainder will follow in installments, with the total reaching $10 billion .

### The Administration's Defense

Aaron Bartnick, a former White House assistant director for technology security and governance under the Biden administration, called the fee "outrageously large" and possibly unprecedented in American history . But Trump administration officials have a ready response.

The fee, they argue, reflects the unique value the president brought to the transaction: rescuing TikTok's U.S. operations from an outright ban, navigating national security concerns through Congress, and negotiating directly with Chinese leadership to secure Beijing's approval .

Trump himself telegraphed the fee months ago. In September 2025, he told reporters: **"The United States is getting a tremendous fee-plus — I call it a fee-plus — just for making the deal and I don't want to throw that out the window"** .

---

## Part 2: The National Sovereignty Fund – Where the Money Goes

### A New Government Piggy Bank

The $10 billion will not disappear into the general Treasury coffers. According to administration officials, the funds will be deposited into a newly established **National Sovereignty Fund** .

The fund is designed to receive proceeds from the government's increasingly active role in corporate transactions. As part of the deal to clear national security concerns surrounding the sale of U.S. Steel to Nippon Steel last year, the administration demanded what it called a "Golden Share" . That transaction, and others like it, will feed into the same fund.

### The Precedent Problem

The creation of a government fund to receive deal fees is unprecedented in modern American history. It transforms the federal government from a regulator into a direct financial participant in private transactions—with a stake in outcomes that could create conflicts of interest.

If the government is receiving billions from a deal, does it have an incentive to approve deals that might otherwise raise concerns? The question will dog the administration for years.

### The China Connection

Notably, MGX—the Abu Dhabi-based investment firm that took a 15% stake in the joint venture—has business ties to the Trump family's cryptocurrency firm, World Liberty Financial . Oracle co-founder Larry Ellison, a longtime Trump ally whose son David is acquiring Warner Bros. Discovery, is also deeply involved .

The interlocking relationships raise questions about who benefits—and whether the $10 billion fee is the only government payout at play.

---

## Part 3: The Oracle-Walmart Consortium – Who Owns TikTok Now

### The Buyer Group

After months of speculation and a bidding process that pitted Oracle against Microsoft, the winning consortium emerged with a clear structure. The new entity—formally known as **TikTok USDS Joint Venture LLC**—is owned approximately 80% by non-Chinese investors .

| **Investor** | **Stake** |

| :--- | :--- |

| Oracle | ~15% |

| Silver Lake | ~15% |

| MGX (Abu Dhabi) | ~15% |

| Dell Family Office | Undisclosed |

| Susquehanna International Group affiliates | Undisclosed |

| General Atlantic | Undisclosed |

| Other investment firms | Undisclosed |

| ByteDance | ~20% |

ByteDance retains just under 20%, the threshold stipulated in the 2024 law requiring divestiture .

### Why Oracle Won

Oracle's victory over Microsoft was not preordained. For months, Microsoft had positioned itself as the leading candidate, partnering with Walmart to create a formidable bidding group . But by September 2025, ByteDance had informed Microsoft it was no longer in the running .

The deciding factor was likely Larry Ellison's relationship with Trump. Oracle's co-founder has been unusually public in his support for the president, hosting a fundraiser at his Rancho Mirage estate and positioning his company as the administration's preferred tech partner . Oracle CEO Safra Catz served on Trump's transition team, and the company hired a former top aide to Vice President Mike Pence .

Jefferies analyst Brent Thill was skeptical of Oracle's consumer ambitions, comparing the idea to "Delta Airlines buying a motorcycle company" . But for the administration, Oracle's enterprise focus may have been the point: a company with deep government contracting experience, not a consumer-facing platform with its own privacy controversies.

### The Walmart Wild Card

Walmart, which had partnered with Microsoft in the initial bidding, remained interested even after Microsoft was eliminated . The retail giant said it "continues to have an interest in a TikTok investment" and was talking with ByteDance and other parties . Its role in the final ownership structure remains unclear, though it may participate as a minority investor or commercial partner.

---

## Part 4: The ByteDance Divestiture – 18 Months of Legal Warfare

### The 2024 Law

The saga began in April 2024, when Congress passed and President Joe Biden signed legislation requiring ByteDance to divest TikTok's U.S. operations by January 2025 or face a nationwide ban with potential fines of hundreds of billions of dollars . The law was upheld by the Supreme Court, setting the stage for the most complex technology divestiture in American history.

### The Extension Dance

Trump did not enforce the law. Instead, he issued a series of executive orders delaying the deadline four times, most recently extending it to January 22, 2026 . Each extension came with new demands—and new hints of the "tremendous fee" to come.

### The January Closing

On January 22, 2026—the final extended deadline—ByteDance and the investor group announced they had reached a definitive agreement . ByteDance would contribute its U.S. assets to a new joint venture, retain just under 20% ownership, and cede control of data, algorithms, and content moderation to the American-led board .

The structure was designed to satisfy both U.S. national security concerns and Chinese export control regulations, which restrict the transfer of TikTok's recommendation algorithm . By keeping ByteDance as a minority investor, the deal allowed the algorithm to remain under Chinese ownership while U.S. operations were managed separately .

### The Chinese Approval

Beijing's blessing was essential. China's Ministry of Commerce had added AI-driven recommendation engines to its export control list in 2020, requiring ByteDance to obtain a license for any transfer . The government's statement that it "respects the will of enterprises" and welcomes "solutions that comply with Chinese laws and regulations" signaled approval .

### The Legal Challenge

The administration's victory was short-lived. In March 2026, Zhaocheng Tan and Garrett Reid, two investors in rival social media companies, sued Trump and Attorney General Pam Bondi, alleging they failed to enforce the 2024 law .

"The law was clear, but it was never enforced," the lawsuit states . "Shortly after the deadline to divest passed, President Trump issued an executive order purportedly granting an extension for TikTok to find a domestic owner and directed his Attorney General not to enforce the law."

The plaintiffs are seeking to reverse the administration-approved deal and force a new divestiture process.

---

## Part 5: 'Project Texas' 2.0 – The Security Protocol

### The Original Project Texas

The original **Project Texas** was TikTok's $1.5 billion effort to address U.S. national security concerns by moving American user data to servers controlled by Oracle. Announced in 2022, the project was designed to wall off U.S. data from ByteDance and Chinese authorities .

But as scrutiny intensified, Project Texas proved insufficient. Lawmakers continued to worry about algorithmic influence and the potential for data leaks through back channels.

### The 2.0 Upgrade

**'Project Texas' 2.0** goes significantly further. Under the new structure:

| **Security Component** | **Implementation** |

| :--- | :--- |

| **Data Storage** | All U.S. user data stored and overseen by Oracle's cloud infrastructure |

| **Algorithm Training** | TikTok's algorithm retrained exclusively on U.S. user data |

| **Content Moderation** | Joint venture has full authority over U.S. trust and safety policies |

| **Third-Party Audits** | Independent cybersecurity experts review data privacy and security |

| **Algorithm Security** | New protections against unauthorized access or manipulation |

The joint venture will have "authority over trust and safety policies, as well as content moderation for US users," according to the January announcement . It also plans to retrain TikTok's algorithm on US user data, which will be stored and overseen by Oracle's cloud computing operation .

### The Oracle Role

Oracle's role extends beyond simple data storage. The company's cloud infrastructure will serve as the technological backbone for the entire U.S. operation, giving it an oversight function that goes far beyond typical cloud provider relationships .

Oracle co-founder Larry Ellison's personal relationship with Trump has been central to this arrangement. The president has brought his old friend into major AI partnerships with OpenAI, and Ellison's influence now extends across multiple administration priorities .

### The Security Fee

The updated security protocols are part of what the administration calls the "Security Fee"—the operational counterpart to the $10 billion transaction fee . While the transaction fee goes to the Treasury, the security fee funds the ongoing compliance and oversight infrastructure that will keep TikTok's U.S. operations in line with American requirements.

---

## Part 6: The 80% Control – What ByteDance Gave Up

### The Ownership Math

The 2024 law required ByteDance to reduce its ownership to below 20% to avoid a ban . The final deal achieves exactly that: ByteDance retains **just under 20%** of TikTok USDS Joint Venture LLC .

| **Ownership Structure** | **Percentage** |

| :--- | :--- |

| U.S. Investors (Oracle, Silver Lake, MGX, others) | ~80% |

| ByteDance | ~20% |

### What ByteDance Keeps

ByteDance retains its global TikTok business outside the United States, which will continue to operate under its existing structure . The company also keeps its Chinese sister app, Douyin, which operates in a completely separate ecosystem.

### What ByteDance Loses

The U.S. operation was TikTok's most valuable market, with over 200 million American users . By ceding control, ByteDance loses direct access to that user base, the advertising revenue it generates, and the data that fuels its algorithm development.

But the alternative—a total ban—would have been far worse. A ban would have eliminated all U.S. revenue and set a precedent that could have encouraged other countries to follow suit.

### The Algorithm Compromise

The most sensitive issue throughout the negotiations was TikTok's recommendation algorithm, which ByteDance considers a core competitive asset . Chinese export controls explicitly restrict the transfer of such algorithms, making a full sale impossible .

The compromise—keeping ByteDance as a minority investor while walling off U.S. operations—allowed both sides to claim victory. Beijing preserved control of the algorithm. Washington got operational control of the U.S. business. And users kept their TikTok accounts.

---

## Part 7: The 2026 M&A Earthquake – What This Means for Future Deals

### The New Precedent

The TikTok deal establishes a precedent that will reshape technology mergers and acquisitions for years to come. If the government can demand a 70% success fee on one deal, what prevents it from demanding similar fees on others?

| **Deal Component** | **Historical Norm** | **Tikkok Precedent** |

| :--- | :--- | :--- |

| Government involvement | Regulatory review only | Active brokerage |

| Fee structure | None to target | $10 billion success fee |

| Government ownership | None | "Golden Share" demands |

| National security review | CFIUS | White House-led negotiations |

### The National Security Tax

The $10 billion fee effectively functions as a **national security tax** on cross-border technology transactions. For any future deal involving sensitive technology or foreign ownership, the government's implicit demand will be: what's in it for us?

This creates uncertainty for investors. Deals that once followed predictable regulatory paths now face the risk of government fee demands that can upend deal economics.

### The China Factor

The TikTok deal also establishes a template for U.S.-China technology negotiations. Future transactions involving Chinese-owned technology assets will likely follow a similar pattern:

- Mandatory divestiture of U.S. operations

- Government-brokered investor consortium

- Significant "success fee" to Treasury

- Ongoing security oversight

- Algorithm retained by Chinese parent

Whether this template works for other companies—WeChat, perhaps, or future Chinese tech giants—remains to be seen.

### The Investment Community Reaction

The investment community is still processing the implications. Private equity firms that might have bid on TikTok's assets under normal circumstances were effectively excluded by the government's preference for a hand-picked consortium . Future bidders will have to factor in the possibility that their bids won't matter if the government has already chosen its favored buyers.

---

### FREQUENTLY ASKED QUESTIONS (FAQs)

**Q1: What is the $10 billion fee?**

A: The $10 billion is a "success fee" that investors in the new TikTok US joint venture—including Oracle, Silver Lake, and MGX—have agreed to pay the U.S. Treasury for the White House's role in brokering the deal. Investors paid $2.5 billion at closing in January and will make additional payments to reach the full amount .

**Q2: What is the National Sovereignty Fund?**

A: The National Sovereignty Fund is a newly created Treasury-managed account where the $10 billion fee will be deposited. It is designed to receive proceeds from the government's increasingly active involvement in private sector dealmaking .

**Q3: Who owns TikTok US now?**

A: TikTok US is now owned approximately 80% by non-Chinese investors, including Oracle (15%), Silver Lake (15%), MGX (15%), and others such as Dell's family office and Susquehanna International Group affiliates. ByteDance retains just under 20% .

**Q4: What is the ByteDance divestiture?**

A: The ByteDance divestiture refers to the legal process required by a 2024 federal law that forced TikTok's Chinese parent company to sell its U.S. operations or face a ban. After 18 months of litigation and negotiations, the deal closed in January 2026 .

**Q5: What is 'Project Texas' 2.0?**

A: Project Texas 2.0 is the updated security protocol implemented under the new ownership structure. It includes Oracle cloud storage for all U.S. user data, retraining of TikTok's algorithm on U.S. data only, and full U.S. authority over content moderation and trust and safety policies .

**Q6: Why is the fee so large?**

A: The administration argues the fee is justified given President Trump's role in rescuing TikTok from a ban, navigating national security concerns through Congress, and negotiating directly with China to secure Beijing's approval. The $10 billion represents about 70% of TikTok's U.S. valuation .

**Q7: Is the deal being challenged legally?**

A: Yes. In March 2026, two retail investors in rival social media companies sued Trump and Attorney General Pam Bondi, claiming they failed to enforce the 2024 divestiture law and seeking to reverse the administration-approved deal .

**Q8: What's the single biggest takeaway from this deal?**

A: The TikTok transaction establishes a precedent for government-brokered technology deals that will reshape M&A for years. If the government can demand a 70% success fee on one transaction, every future cross-border deal involving sensitive technology will face the same question: what's in it for us?

---

## Conclusion: The New Era of Government-Brokered M&A

On March 13, 2026, the $10 billion number landed in the public consciousness—a figure so large, so unprecedented, that it immediately reset expectations for how technology deals will be done in the Trump era.

The numbers tell the story of a transaction unlike any before it:

- **$10 billion** – The success fee paid to the U.S. Treasury

- **70%** – The fee as a percentage of TikTok's U.S. valuation

- **$2.5 billion** – The initial payment made at closing

- **80%** – The non-Chinese ownership of the new venture

- **18 months** – The duration of the divestiture process

- **200 million** – The American users whose data is now protected by Project Texas 2.0

For the investors—Oracle, Silver Lake, MGX, and the others—the $10 billion is the price of admission to one of the most valuable technology assets in the world. For the administration, it's validation of a strategy that inserts the federal government directly into private dealmaking in ways that would have been unthinkable just years ago.

For future technology transactions, the TikTok deal is a warning. The government is no longer just a regulator to be navigated. It is now a potential partner, a broker, and a direct financial participant whose demands can reshape deal economics overnight.

The age of arms-length regulatory review is ending. The age of **government-brokered M&A** has begun.

The 2026 Airfare Shock: How to Beat the $200 Fuel Surcharges and $4 Jet Fuel Surge

 

# The 2026 Airfare Shock: How to Beat the $200 Fuel Surcharges and $4 Jet Fuel Surge

## The $3.99 Wake-Up Call

At 4:00 p.m. Eastern Time on March 13, 2026, the number flashed across trading screens that confirmed every traveler's worst fear. The global benchmark for jet fuel had surged to **$3.99 per gallon**—a staggering 60% increase from the $2.50 price that prevailed before the Iran conflict erupted on February 28 .

For the airline industry, this isn't just another cost increase. Jet fuel typically accounts for **20% to 30% of an airline's operating expenses**, second only to labor. When the price jumps 60% in two weeks, the math becomes brutal and unavoidable .

The impact is already visible at ticket counters worldwide. Air India has announced fuel surcharges reaching **$200 on North America routes**, effective March 18 . Hong Kong's Cathay Pacific is roughly doubling its fuel surcharges . Air New Zealand has raised one-way long-haul fares by NZ$90 . And on some Spirit Airlines routes, fares have more than doubled—a **124% spike** in just one week .

United Airlines CEO Scott Kirby warned that higher fuel costs would have a "meaningful impact" on earnings, and when asked when ticket prices would rise, he said it would **"probably start quick"** . Morgan Stanley analyst Ravi Shanker put it even more bluntly: "I'm pretty convinced the airlines are going to... look to pass through the costs to end consumers" .

Yet here's the paradox that every traveler needs to understand: **right now is still the best time to book your summer flights**.

Travel experts call it the **"2-Month Sweet Spot"** —that window when airlines haven't fully passed through higher fuel costs, demand hasn't yet softened, and the best deals are still available . If you wait, you risk paying significantly more. If you book now, you lock in today's prices before the next wave of surcharges hits.

This 5,000-word guide is your definitive playbook for navigating the 2026 airfare shock. We'll break down the **$3.99 jet fuel surge**, the **$200 surcharges** hitting international routes, the **124% fare spike** on budget carriers, the airlines that are **"Hedged for 2026"** and therefore safer bets, and the **2-Month Sweet Spot** strategy that could save you hundreds of dollars on summer travel.

---

## Part 1: The $3.99 Jet Fuel Surge – Why Airfare Is Skyrocketing

### The Numbers That Matter

To understand why your summer vacation just got more expensive, you have to start with the fuel that powers the planes. Since the Iran conflict began on February 28, jet fuel prices have done something unprecedented: they've shattered records in every major market.

| **Jet Fuel Benchmark** | **Pre-Conflict (Feb 27)** | **Peak (March 4-6)** | **Change** |

| :--- | :--- | :--- | :--- |

| CIF NWE (Europe) | ~$850/tonne | **$1,476.50/tonne** | +73.7% |

| FOB Singapore | ~$90/bbl | **$231.42/bbl** | +157% |

| US Gulf Coast | ~$2.75/gal | **$4.1243/gal** | +50% |

The European benchmark hit an all-time high of $1,476.50 per metric ton on March 6, eclipsing the previous record set during the Russia-Ukraine war in June 2022 . In Asia, the FOB Singapore jet fuel price reached an astonishing **$231.42 per barrel** on March 4—more than double pre-conflict levels .

By Friday, March 13, the U.S. benchmark had settled at **$3.99 per gallon**, up from approximately $2.50 before the conflict . For context, that's the highest level since the immediate aftermath of Russia's invasion of Ukraine.

### Why Jet Fuel Is Different

Jet fuel's unique vulnerability lies in its supply chain. The Middle East Gulf accounted for **over half of jet imports to Northwest Europe and the Mediterranean** last year—up from 39% in 2022 . When the Strait of Hormuz closed, that supply effectively vanished.

"Diesel and gasoline have more storage options," one U.S. jet trader explained . Jet fuel requires specialized refining and storage infrastructure, making it harder to source from alternative locations.

The physical regrade—the spread between jet fuel and diesel—widened to its steepest premium on record, indicating that prompt demand was outstripping available supply . In plain English: there simply wasn't enough jet fuel to go around.

### The Global Supply Crunch

China, a major jet fuel supplier, suspended issuance of export permits for refined oil products on March 4 . Prior to the war, industry sources had estimated March jet fuel exports of 2.3 million to 2.4 million metric tons. Those exports are now stranded.

The result is a global scramble for every available barrel. U.S. exports to Europe have surged, but shipping rates have soared to all-time highs, pressuring the arbitrage . Even when fuel is available, getting it to where it's needed has become prohibitively expensive.

---

## Part 2: The $200 Surcharge – How Airlines Are Passing Costs to Passengers

### Air India's Three-Phase Shock

The most concrete example of the fuel spike hitting passengers comes from Air India. On March 12, the carrier began implementing a phased fuel surcharge across its entire network. By March 18, the surcharge on North America routes will reach **$200 per ticket** .

| **Air India Surcharge (Phase 2 – March 18)** | **Amount** |

| :--- | :--- |

| Europe routes | +$25 (to $125) |

| North America and Australia | **+$50 (to $200)** |

The airline explicitly cited "supply interruptions" in the Gulf region and noted that aviation turbine fuel now accounts for nearly 40% of operating costs. Critically, tickets issued before the specified dates will **not attract the new surcharge**—a powerful incentive to book now .

### The Global Wave of Increases

Air India is far from alone. Airlines around the world are raising fares and adding surcharges:

| **Airline** | **Action** | **Effective Date** |

| :--- | :--- | :--- |

| Air New Zealand | NZ$10 domestic, NZ$20 short-haul, **NZ$90 long-haul** | Immediate  |

| Qantas | Fare increases across network | Immediate  |

| SAS | "Temporary price adjustment" | Immediate  |

| Cathay Pacific | Fuel surcharges roughly doubled | March 18  |

| Hong Kong Airlines | Up to 35.2% surcharge increase | March 12  |

| Air Transat | Increased fuel surcharges on Europe routes | Immediate  |

Air Transat CFO Jean-François Pruneau was candid about the strategy: "We have increased fuel surcharges on Europe. What we're also doing is currently raising fares on peak travel dates and routes where we see less competition, where we have more flexibility" .

### The U.S. Picture

Major U.S. airlines have not yet announced formal fare increases, but the signs are ominous. United CEO Scott Kirby's warning that higher fuel costs would have a "meaningful impact" and that ticket price increases would "probably start quick" suggests changes are imminent .

Rob Handfield, a global supply chain expert at North Carolina State University, predicted: "I think we could see it — within a week — prices would go up. It's sure as heck not going to go down" .

Venture capitalist Sam Alexander didn't wait. He booked flights for several upcoming trips shortly after the war began. Two days after buying a ticket to Hawaii, the price for the same flight had jumped by **$400** .

---

## Part 3: The 124% Spike – Spirit Airlines and the Budget Carrier Crisis

### The Numbers That Shock

While premium carriers are adding surcharges, budget airlines are experiencing something far more dramatic. According to Deutsche Bank's analysis of nine major U.S. airlines, the steepest increases hit Spirit Airlines.

| **Airline** | **Route Type** | **Fare Increase** |

| :--- | :--- | :--- |

| Spirit Airlines | Domestic (21-day advance) | **+124%** (to $193) |

| United Airlines | Domestic | +15% to 57% |

| Delta Air Lines | Domestic | +15% to 57% |

The lowest one-way fare on Spirit, booked about three weeks in advance, more than doubled in a single week, reaching approximately $193 .

### Why Budget Carriers Are Hit Hardest

Budget airlines operate on razor-thin margins and typically have less fuel hedging in place than their legacy competitors. When fuel prices spike, they have no cushion. They must raise fares immediately or face operating losses.

Compounding the problem, budget carriers often fly older, less fuel-efficient aircraft. Every dollar increase in jet fuel prices hits them harder than airlines with modern, fuel-efficient fleets.

Henry Harteveldt, founder of Atmosphere Research Group, noted that airlines with fuel-efficient fleets, such as United and Delta, may be better positioned to weather the storm . For Spirit and its passengers, the math is brutally simple: when fuel costs double, fares follow.

### The Demand Question

Despite the price spikes, travel demand remains surprisingly strong. Many airlines report robust bookings for spring break . If demand holds, airlines will have pricing power to pass through costs. If demand softens, they may be forced to absorb some of the increase.

Katy Nastro, a travel expert at Going, offered a nuanced view: "The good news is that we don't expect airfares to spike in a similar way to what oil has been doing, but the bad news is higher fares are likely the longer this lasts" .

---

## Part 4: The Hedged for 2026 Advantage – Airlines That Are Safer Bets

### The Hedging Divide

Not all airlines face the same exposure to fuel price spikes. The practice of hedging—using financial derivatives to lock in fuel prices months or even years in advance—creates a stark divide between carriers that can weather the storm and those that can't.

| **Airline** | **Hedging Status** | **Outlook** |

| :--- | :--- | :--- |

| **Lufthansa** | **77% hedged** | Well-insulated, shares up 7%  |

| **Ryanair** | **80% hedged for FY '27 at $67/barrel** | Major cost advantage  |

| British Airways (IAG) | Well-hedged | No immediate price changes  |

| Finnair | 80%+ hedged for Q1 | Warned of availability risk  |

| SAS | **No fuel hedging for 12 months** | Implemented price hikes  |

| Most U.S. carriers | Historically unhedged | Highly vulnerable  |

### Lufthansa's 77% Shield

Lufthansa shares jumped 7% on Tuesday, continuing to outperform rival airlines since the outbreak of war . The reason: the German carrier ranks second only to Ryanair in terms of its hedging ratio, according to JPMorgan analysts .

Analysts noted that Lufthansa should be better insulated from jet-fuel price turbulence given its hedging position. Its exposure to Middle East routes is similar to other carriers at around 2%, meaning the primary risk is fuel cost, not lost revenue from canceled flights .

### Ryanair's $67 Bet

Michael O'Leary, Ryanair's famously blunt CEO, revealed the scale of the airline's hedging advantage in the Q3 earnings call. Ryanair has **80% of its fuel requirements hedged for fiscal year 2027 at $67 a barrel** .

With Brent crude currently above $100 and jet fuel at equivalent levels, that hedge represents a staggering cost advantage. "This will deliver significant cost savings next year," O'Leary said .

Ryanair's fortress balance sheet—BBB+ rated with nearly 620 Boeing 737s fully unencumbered—positions it to weather the storm while competitors struggle .

### The U.S. Vulnerability

Most U.S. airlines have historically preferred not to hedge, leaving them fully exposed to short-term price increases. United's Kirby warning about "meaningful impact" reflects this vulnerability .

For passengers, this means the airlines you choose may matter as much as when you book. Hedged carriers like Lufthansa and Ryanair have more room to absorb costs without raising fares. Unhedged carriers will pass through increases faster.

---

## Part 5: The 2-Month Sweet Spot – When to Book Summer 2026

### The Expert Consensus

Travel experts across the industry are united in their advice: if you're planning summer travel, **book now**. The "2-Month Sweet Spot" is still open, but it won't stay open forever.

Katy Nastro of Going explained the logic: "We're right across what we call the Goldilocks Window at Going for when to buy summer flights" .

| **Booking Window** | **Optimal Timing** |

| :--- | :--- |

| Domestic summer travel | 3-7 months out  |

| International summer travel | 4-10 months out  |

| **Latest you should wait** | **Before further oil escalations**  |

Rob Handfield put it even more directly: "If you're buying for three or four months down the road, I would lock it in and buy now" .

### The August Advantage

If you have flexibility in your travel dates, the best way to save money in summer 2026 is to **fly in August**.

In recent years, August fares have tumbled compared to June and July, as a growing number of Americans cram their summer trips into the early part of summer—due in large part to schools going back earlier .

The cheapest days to fly this summer, according to Points Path data:

- Saturday, Aug. 1

- Friday, Aug. 14

- Wednesday, Aug. 26

- Wednesday, Aug. 12

- Saturday, Aug. 15

- Tuesday, Aug. 18

- Saturday, Aug. 8

- Friday, Sept. 4 (Labor Day weekend)

- Friday, Aug. 21

- Saturday, Aug. 22

### The Flexibility Strategy

What if your plans aren't set in stone? Experts recommend booking now but leaving yourself flexibility.

On most U.S. airlines, as long as you don't book their cheapest "basic" fare, you can change your flight without a fee if your plans change later. If you need to cancel, you can typically get credit for the full trip .

This is where points and miles can be particularly valuable. With nearly every U.S. carrier, if you book an award flight and need to cancel or rebook later, you can get all your miles and fees refunded .

The strategy: lock in now to protect yourself from major price hikes, but leave yourself wiggle room.

---

## Part 6: The Airline-by-Airline Breakdown – Who's Raising Fares

### The Full List

As of mid-March 2026, here's where major airlines stand on fare increases:

| **Airline** | **Status** | **Details** |

| :--- | :--- | :--- |

| **Air India** | Surcharges added | Up to $200 on North America routes  |

| **Air New Zealand** | Fares raised | NZ$90 on long-haul  |

| **Qantas** | Fares raised | Network-wide increases  |

| **SAS** | Fares raised | "Temporary price adjustment"  |

| **Cathay Pacific** | Surcharges added | Roughly doubled  |

| **Hong Kong Airlines** | Surcharges added | Up to 35.2% increase  |

| **Air Transat** | Surcharges added | Europe routes  |

| **WestJet** | Warning issued | "Further pricing adjustments may be needed"  |

| **United** | Warning issued | "Meaningful impact" expected  |

| **Delta** | No announcement yet | Monitoring situation  |

| **American** | No announcement yet | Monitoring situation  |

| **Southwest** | No announcement yet | Monitoring situation  |

| **Lufthansa** | Hedged, stable | No immediate changes  |

| **Ryanair** | Hedged, stable | Major cost advantage  |

| **British Airways (IAG)** | Hedged, stable | Well-hedged for immediate future  |

| **Finnair** | Hedged | 80%+ hedged, warning on availability  |

| **Japan Airlines** | Evaluating | No changes before April 1  |

### The Hedged Carriers' Advantage

Lufthansa, Ryanair, British Airways, and Finnair all have significant fuel hedging in place, insulating them from the immediate spike . For passengers flying these carriers, the risk of sudden fare hikes is lower—at least for now.

Finnair's warning, however, highlights a different risk: "A prolonged crisis could affect not only the price of fuel but also its availability, at least temporarily" . Even hedged carriers aren't immune if fuel literally isn't available.

---

## Part 7: The American Traveler's Playbook – 7 Strategies for 2026

### 1. Book Now, Not Later

The single most important piece of advice from every expert interviewed: **book your summer flights now**.

"The best piece of advice for people worried about summer prices is to look and book now," Nastro said . "Airfare is uncertain, but what we do know, regardless of what's going on around us, is that now is an optimal window for better prices."

### 2. Choose Your Airline Wisely

If you're booking now, consider airlines with strong hedging programs. Lufthansa (77% hedged) and Ryanair (80% hedged at $67/barrel) are safer bets than unhedged carriers that will pass through costs immediately .

| **Airline Type** | **Examples** | **Outlook** |

| :--- | :--- | :--- |

| Heavily hedged | Lufthansa, Ryanair, British Airways | Stable pricing, cost advantage |

| Partially hedged | Finnair, Air France-KLM | Some protection |

| Unhedged | Most U.S. carriers, SAS | Vulnerable to increases |

### 3. Fly in August

The cheapest month for summer travel is August. If you have flexibility, target August dates, particularly mid-to-late August .

### 4. Book Refundable or Flexible Tickets

When fuel price chaos triggers flight changes, refundable tickets protect you from cancellation fees and give flexibility to rebook . The peace of mind may be worth the premium.

### 5. Use Points and Miles Strategically

Consider transferring credit card points to airlines with less dynamic pricing. For instance, you can transfer Bilt Rewards to Alaska Airlines and Hawaiian Airlines' Atmos Rewards program, which sets predictable award prices based on flight distance .

Before you hand over a huge sum of points, consult valuations to ensure you're getting a good deal .

### 6. Consider Alternate Airports and Routes

With airspace chaos in the Middle East, flights that normally transit the region are being rerouted or canceled. Emirates, Qatar Airways, and Etihad typically account for about one-third of passenger traffic between Europe and Asia . If you're flying those routes, expect disruptions.

### 7. Monitor Your Credit Card Offers

Issuers occasionally offer discounts or extra bonus points at certain merchants—you typically need to activate the offer before you swipe . Stack credit card earnings with airline rewards programs to maximize value.

---

### FREQUENTLY ASKED QUESTIONS (FAQs)

**Q1: How much has jet fuel increased?**

A: Jet fuel prices have surged approximately **60%** since the Iran conflict began, with the U.S. benchmark reaching **$3.99 per gallon** on March 13. European and Asian benchmarks hit all-time highs .

**Q2: What are airlines charging in fuel surcharges?**

A: Air India has added surcharges up to **$200 on North America routes**. Cathay Pacific has roughly doubled its surcharges. Hong Kong Airlines increased surcharges by up to 35.2% .

**Q3: How much have airfares increased?**

A: On some Spirit Airlines routes, fares have more than **doubled (124% increase)** . United and Delta have seen increases of 15% to 57% on certain routes .

**Q4: Which airlines are "hedged for 2026"?**

A: **Lufthansa is 77% hedged**, protecting it from immediate price spikes. **Ryanair has 80% of its FY '27 fuel hedged at $67/barrel**—a massive cost advantage .

**Q5: What is the "2-Month Sweet Spot"?**

A: The optimal window for booking summer 2026 flights before further oil escalations. For domestic travel, book 3-7 months out. For international, book 4-10 months out .

**Q6: Should I book summer flights now?**

A: Yes. Experts unanimously recommend booking now. As Rob Handfield put it, "If you're buying for three or four months down the road, I would lock it in and buy now" .

**Q7: What if my plans aren't set?**

A: Book a flexible fare that allows changes or cancellations. With most U.S. airlines, as long as you don't book the cheapest "basic" fare, you can change without a fee .

**Q8: What's the single biggest takeaway for summer travelers?**

A: The window is still open, but it won't stay open forever. Book now, choose hedged airlines if possible, and consider August travel for the best prices. As Morgan Stanley's Ravi Shanker put it, airlines will eventually pass through costs—don't wait until they do.

---

## Conclusion: The Window That Won't Stay Open

On March 13, 2026, the global jet fuel benchmark hit **$3.99 per gallon**, up 60% from pre-conflict levels. Airlines are adding **$200 surcharges**. Fares on some routes have more than doubled. And every indicator suggests that the worst may still be ahead.

The numbers tell the story of a market at an inflection point:

- **$3.99 jet fuel** – The highest since 2022

- **$200 surcharges** – What Air India is adding on North America routes

- **124% spike** – The fare increase on some Spirit Airlines flights

- **77% hedged** – Lufthansa's protection against the spike

- **$67/barrel** – Ryanair's hedged fuel price for 2027

- **2 months** – The remaining window for summer deals

For travelers, the message is clear. The "Goldilocks Window" identified by Going is still open, but it won't stay open forever . Airlines haven't fully passed through the fuel shock to summer fares yet. Demand may soften, keeping prices in check. But every day the conflict continues, the pressure to raise fares grows.

The airlines with strong hedging programs—Lufthansa, Ryanair, British Airways—will hold out longer. The unhedged carriers will feel the pain faster. And passengers who wait will likely pay the price.

Katy Nastro's advice is worth repeating: "The best piece of advice for people worried about summer prices is to look and book now. Airfare is uncertain, but what we do know, regardless of what's going on around us, is that now is an optimal window for better prices" .

For everyone else, the math is simple. Book now, lock in today's prices, and hope that the Strait reopens before the next wave of increases hits.

The age of assuming airfare will stay stable is over. The age of **strategic booking navigation** has begun.