On Monday, oil prices reached their highest levels in five months, creating a ripple effect that put a dent in the stocks of airlines, cruise lines, and other businesses heavily influenced by fuel costs.
A significant jump of over 3% in oil prices was noted towards the end of last week. This surge followed the Treasury Department’s broad sanctions on Russia’s oil industry, sparking fears about potential disruptions to the global supply chain.
Brent crude, known as the global benchmark, climbed over 1% to around $81 per barrel—a peak not seen since August. Meanwhile, West Texas Intermediate, the American benchmark, was trading at $78.70 a barrel by Monday afternoon, marking an almost 3% increase from Friday’s figures.
Airlines, for whom fuel represents a hefty expense, felt the squeeze on Monday. Delta Air Lines and United Airlines both saw their shares dip over 2%, and American Airlines faced a more substantial drop of more than 4%. Cruise companies weren’t spared either, with Carnival and Norwegian Cruise Line slipping by about 1.6% and 0.6%, respectively.
On the brighter side, oil and natural gas producers emerged as top performers within the S&P 500 on Monday. Shares of Baker Hughes climbed nearly 4%, while ExxonMobil made gains close to 3%.
Travel-related stocks wrapped up the year on a high note, buoyed by declining oil prices and unwavering consumer demand post-pandemic. Notably, United Airlines became one of the best performers in the S&P 500 in 2024, with its shares more than doubling in value over the past year. Delta saw an impressive gain of around 69% during the same timeframe. Although Royal Caribbean’s stock was relatively steady on Monday, it has surged over 87% in the last 12 months.
