Airline stocks slide as oil nears $110 amid Iran war

The prolonged U.S.-Iran conflict is again pushing oil prices toward levels that threaten airline profitability worldwide, with crude challenging $110 per barrel and jet fuel costs running roughly 45% higher than a year ago. The surge — driven by renewed attacks near the Strait of Hormuz — is battering airline and cruise stocks while forcing carriers to weigh painful tradeoffs between absorbing losses and raising fares.

Aegean's Loss Signals Broader Pain

Greece's Aegean Airlines on Monday reported a first-half net loss of €3.3 million, swinging sharply from a €47.9 million profit a year earlier. Revenue rose 4% to €816.6 million and passenger traffic climbed 3% to 7.8 million, but higher fuel prices and emissions allowances imposed a net negative impact of €40 million despite hedging, the carrier said. CEO Dimitris Gerogiannis said Aegean Airlines plans to maintain "a disciplined capacity outlook for at least the next six to eight months" as jet fuel prices remain twice as high as at the beginning of the year.reuters

The pattern extends well beyond Athens. In the United States, American Airlines ↗ 0.69% fell 5%, United Airlines ↘ 0.77% dropped 4%, and Delta ↘ 0.14% and JetBlue ↘ 0.91% slipped 3% earlier this month as crude oil jumped. American Airlines has already cut its full-year profit outlook twice in 2026, citing fuel costs of roughly $4 per gallon. Bureau of Transportation Statistics data showed U.S. airlines paid $3.40 per gallon in July, up 45% from a year earlier.kavout+2

Oil Market Driven by Strait of Hormuz Hostilities

The latest price spike follows renewed attacks on vessels near the Strait of Hormuz, a chokepoint for roughly a fifth of global oil supply. At least 15 vessels were struck by Iran or the U.S. over one week in early September, sending Brent crude past $100 a barrel for the first time since July. The U.S. Energy Information Administration raised its 2026 Brent price forecast to about $91 per barrel on average, citing 6.7 million barrels per day of Middle East output shut-ins in August. Goldman Sachs The Goldman Sachs Group, Inc. ↘ 3.93% has warned prices could exceed $120 if attacks in the Persian Gulf and Red Sea intensify further.democracynow+3

Middle East Carriers Absorb Costs — For Now

Not all airlines are responding the same way. Etihad Airways CEO Antonoaldo Neves said fierce competition among Middle Eastern carriers means rising fuel costs will not be passed on to passengers yet, telling Bloomberg that fuel prices would have to remain elevated longer before ticket price increases are considered. Still, industry-wide, U.S. fares are already up 25.5% year-over-year as of July, and the Seeking Alpha analysis noted that carriers lacking fuel hedges — including Carnival ↘ 0.84% in the cruise sector and American Airlines — face the steepest exposure.bloomberg+2