By Callum Keown

Surging oil prices are upending the stock market. But so far, one sector seems to be getting hit harder than others -- the travel industry.

Norwegian Cruise Line and Carnival have both fallen close to 20% since the conflict began, through Friday's close -- the two worst performers in the S&P 500 over the period. Southwest Airlines, down 16% and United Airlines, 13% lower, aren't far behind. Delta Air Lines, American Airlines and Royal Caribbean have all dropped more than 10%.

Unsurprisingly, they are all falling again ahead of the open Monday as oil prices surged above $100 a barrel. Though, a sharp pullback from highs of close to $120 means the damage to travel stocks was more limited -- airlines and cruise operators were all around 3% to 4% lower in premarket trading.

But it's still not too late for the energy spike to end up being a short-term headwind for the travel sector.

United CEO Scott Kirby said last week that higher fuel prices will have a "meaningful" impact on its first-quarter financial results, CNBC reported. If it continues, United will feel it in the second quarter, too, he added.

While the signs point to a prolonged conflict, it's still a relatively big "if" at this time. United may be better placed than others if there is a sustained comeback -- on account of its "act of God" guidance policy.

"We've had a philosophy here at United to guide conservatively, to build in one act of God, because this industry, things happen. Fuel prices spike," Chief Financial Officer Michael Leskinen said last year.

Wall Street analysts felt United's first-quarter and full-year guidance, issued in January, was a bit pessimistic. In the event of a short war, the carrier may even have a chance of getting somewhere near its cautious full-year earnings-per-share target -- between $12 and $14.

Cruise stocks have had the sharpest fall since the U.S. strikes began, though.

It's too early to say buy the dip, but a 20+% drop is a lot and it's worth noting that cruise stocks were among the worst hit during the Covid-19 pandemic before having a multiyear rally.

Write to Callum Keown at callum.keown@dowjones.com

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March 09, 2026 07:04 ET (11:04 GMT)

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