By Nate Wolf
Shares of United Airlines Holdings and Delta Air Lines fell sharply Friday as geopolitical tensions and rising oil prices grounded airline stocks.
United stock was down 8.4%, making it one of the worst performers in the S&P 500 on the day. Delta shares dropped 6.6%, American Airlines Group tumbled 6.2%, and Southwest Airlines was down 3.3%.
The U.S. Global Jets exchange-traded fund -- which also holds aerospace manufacturers, booking services, and other travel-related companies -- fell 4%. The ETF was on pace for its largest single-day percent decline since July 24, 2025, according to Dow Jones Market Data.
Oil prices were one likely culprit. Brent crude futures rose 2.6% to $72.71 a barrel as the U.S. and Iran failed to reach a deal over Iran's nuclear program, sparking fears of American military action. Iran is both one of the world's largest oil producers and can block the Strait of Hormuz, a vital shipping chokepoint.
Jet fuel is one of the largest expenses for air carriers, and the industry broadly expected costs to decline in 2026. The International Air Transport Association's year-ahead outlook in December included a projection that crude prices would decline 11% and jet fuel prices would fall 2.4% from 2025.
Tensions between the U.S. and Iran have instead seen crude futures prices jump by almost 20% this year.
"The biggest stock risk near-term is oil spiking from a conflict in the Middle East," wrote Seaport Research Partners analyst Daniel McKenzie in an airlines update Friday. Even a temporary spike in crude prices, as oil experts have modeled in the event of U.S. strikes, would blunt Seaport's 2026 earnings outlook, McKenzie said.
Write to Nate Wolf at nate.wolf@barrons.com
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February 27, 2026 14:02 ET (19:02 GMT)
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