US President Donald Trump announced on Sunday that he was sending a delegation to the Pakistani capital for talks with Iran.(AFP)AI Quick ReadUS-listed airline stocks came under renewed selling pressure on 20 April as crude oil prices rebounded, recovering some of their recent losses. The oil prices rose amid escalating tensions between the US and Iran following attacks on commercial vessels in the Strait of Hormuz, reigniting fears of higher operational costs.
Brent crude rose 8% toward $97.50 a barrel after the US Navy carried out its first seizure of an Iranian vessel in the Strait of Hormuz. Iran had earlier halted traffic through the waterway, less than 24 hours after stating that ships could pass.
The US benchmark crude climbed 7% to $89.71 a barrel, recovering from Friday’s 9% decline. The rebound comes after crude prices logged two consecutive weeks of losses, which had pulled prices back to levels seen in the early days of the Iran conflict.
Tracking the rise in crude oil prices, Delta Air Lines shares fell 1.6% to an intraday low of $70.59, while American Airlines Group plunged 6% to $12, erasing all of Friday’s gains.
Similarly, United Airlines Holdings and Southwest Airlines each declined about 2%. Alaska Air Group, JetBlue Airways, and SkyWest also fell 3%, 1.7%, and 2.2%, respectively.
The aviation industry is highly sensitive to crude oil prices, as fuel accounts for over 50% of operating expenses, and any increase in prices can quickly pressure profit margins.
Tensions in the Middle East have intensified again after the United States and Iran accused each other of violating the ceasefire agreement, which is scheduled to expire on Wednesday. The US on Sunday reportedly seized an Iranian-flagged cargo vessel that it said had attempted to evade its blockade of Iranian ports.
Iran’s joint military command reportedly said Tehran would respond soon, termed the US action an act of piracy, and abruptly halted traffic through the waterway less than 24 hours after previously allowing passage, heightening fears of a renewed escalation in hostilities.
US President Donald Trump announced on Sunday that he was sending a delegation to the Pakistani capital for talks with Iran. However, he also renewed his threats, stating that the US would attack Iranian power plants and bridges if no agreement is reached.
Iran’s Foreign Ministry spokesperson, Esmail Baghaei, said on Monday that Tehran has no immediate plans to attend talks with the United States, as per Fars News agency.
Senior Iranian and American negotiators held approximately 20 hours of talks in Islamabad last Saturday without reaching an agreement, with Iranian officials citing excessive US demands and shifting positions as reasons for the failure of the discussions.
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