NEW YORK, March 24, 2026, 10:15 AM EDT
American Airlines Group stock slipped roughly 2.1% to $10.59 early Tuesday, pulling back after Monday’s 3.66% climb. Crude oil’s move above $100 a barrel put the spotlight back on the airline’s sensitivity to rising fuel costs. Reuters
This reversal is significant—fuel runs just behind labor as the biggest expense for airlines, making up 20% to 25% of their operating costs. The stocks had surged the previous day after oil slid over 10%. That drop came when Washington put off strikes on Iranian power plants. But any boost for the group faded quickly. Reuters
Brent crude climbed 1.8%, hitting $101.77 a barrel by 1130 GMT, after Iran pushed back against claims of discussions with the United States. “The reality on the ground is unchanged,” said Nikos Tzabouras, analyst at Tradu.com. Disruption in the Strait of Hormuz continued to weigh. Reuters
Shares of American slid in line with broader sector moves. Delta Air Lines slipped just 0.5%, but United Airlines and Southwest Airlines were each down about 2.2% as of 10 a.m. in New York. Bob Doll at Crossmark Global Investments had pointed to this trend on Monday, saying short-term moves are “all about the price of oil.” Reuters
UBS lowered its price target on American to $14 from $15 on Monday but stuck with its buy call. Analysts noted Gulf Coast jet fuel was pushing toward $5 a gallon—a setup that still benefits Delta and United, given their more robust margins, even after American flagged a pickup in spring demand last week. TipRanks
Not all the sentiment on Wall Street shifted to caution. TD Cowen’s Thomas Fitzgerald bumped his price target on American up to $17 from $13 last week, saying he came away from the industry’s March conference “encouraged”—citing a smaller-than-feared first-quarter fuel impact and upbeat talk from management on bookings ahead. TipRanks
American kicked off the debate back on March 17, bumping up its first-quarter revenue growth target to over 10%—previously 7% to 10%—and signaled that adjusted loss per share would come in at the low end of guidance. CEO Robert Isom pointed out that revenue was picking up pace more quickly than they’d counted on, with that momentum rolling into April and May. Fuel costs, though, climbed by about $400 million for the quarter. Reuters
Underneath the day-to-day moves, American is working to narrow its profit gap versus Delta and United, focusing on boosting premium seat offerings and revamping its corporate sales approach following past friction with travel agencies and business clients. Reuters
The risk is obvious. Crude hangs near the triple-digit mark, and if airlines can’t keep offsetting the fuel squeeze with pricier tickets, American could find itself on shakier ground than Delta or United in the second quarter. Last week, Citi chopped its price target for American shares to $14 from $21, cautioning about downside to first- and second-quarter results—plus 2026 forecasts—across the board. Still, the firm pointed out that lower estimates don’t always guarantee weaker stocks. TipRanks
