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Delta Air Lines, Inc. (DAL) - free report >>
United Airlines Holdings Inc (UAL) - free report >>
Southwest Airlines Co. (LUV) - free report >>
JetBlue Airways Corporation (JBLU) - free report >>
Why Airline Stocks Plummeted on Monday
Major airline stocks like United (UAL - Free Report) , Delta (DAL - Free Report) , and American (AAL - Free Report) fell by as much as 10% during Monday’s trading session; the US Global Jets ETF (JETS - Free Report) took a big hit as well.
Surging oil prices due to Russia’s invasion of Ukraine have caused investors to flee travel-related stocks. Oil prices climbed to their highest level in over a decade yesterday, with prices continuing to spike on Tuesday as the Biden administration announced a U.S. ban on Russian oil imports. Airliners’ fuel costs are now likely to increase, and companies in the industry may be forced to lower Q1 profit and revenue expectations.
UAL, DAL & AAL, along with smaller players like JetBlue (JBLU - Free Report) and Southwest (LUV - Free Report) , are still trying to recover from the coronavirus pandemic. Airlines anticipated that the decline in Omicron cases, warmer weather, and the lifting of restrictions would lead to renewed demand for air travel
While shares of airline stocks rebounded Tuesday, the geopolitical uncertainty, coupled with inflation and supple chain worries, could lead to even more volatility for airlines for the time being.