I doubt they will be flying higher. I haven't seen any changes in the assigned flight lanes.

It simply takes less fuel to get to their assigned height based on less weight.

Also Continental has started charging for the second bag, which probably will result in less weight as some will choose to pack a single bag and not pay the extra fee.

i don't know the calculation, but savings from flying at higher altitudes is a function of how much more fuel it requires to get there, which is where the most fuel is consumed.