Republic Airways has said it is curbing expansion plans for its Frontier Airlines subsidiary due to oil price volatility. Flat seat capacity for the second quarter also contributed to the decision, as management had expected it to expand by 1.5% to 2.5%. Although passenger bookings are up over last year, spikes in jet fuel has forced a rethink of expensive expansion plans. Oil hit a two-year high yesterday to reach $107 a barrel. Republic is not alone in reducing capacity. Delta Air Lines and American have stated they will scale back their capacity growth plans this year.

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