NEW YORK (MarketWatch) -- Plenty of airline stocks approached 52-week lows Monday, as the price for oil charged forward to break a new all-time high.
The Amex Airline Index ($XAL) fell 5.6% to 27.74 points, brushing up against its four-year low of 27.68 it set Jan. 9. All but one of the index's 14 components were in the red.
In energy trading, crude oil for April delivery rallied as much as 2.2% to a record high of $107.44 a barrel on the New York Mercantile Exchange. See Future Movers.
Jet fuel represents airlines' largest cost.
ExpressJet's shares were also under pressure due to weak fourth-quarter results. See full story.
Coming close to full-year lows were Delta Air Lines DAL, +1.63%, United parent company UAL Corp. UAUA, U.S. Airways LCC, +0.00%, Alaska Airlines ALK, +2.27%, Frontier Airlines FRNT, JetBlue JBLU, +2.11% and SkyWest Inc. SKYW, +3.56%.
Delta Air Lines and Northwest Airlines NWA, +6.67% were also in the limelight amid renewed scrutiny over a potential merger announcement. Such an agreement could be forthcoming if the carriers' pilot unions can agree on a method to integrate seniority lists.
Such a deal, it's believed, could then free up UAL Corp. to merge with Continental Airlines CAL, +4.56%.
"We still expect a Delta-Northwest merger announcement in the near term and it could be followed by a Continental-United Airlines deal," said UBS analyst Kevin Crissey in a note to investors. "U.S. airline standalone plans, which may or may not have been reasonable at $60 a barrel oil, are far from attractive at $100 or more."
Analysts have said a merger between major carriers would help raise airfare prices, squeeze out extra costs and help them compete more effectively against foreign carriers for international business.
Over the weekend, all the so-called legacy carriers raised their roundtrip fares by $10 to help offset the higher cost of jet fuel, said FareCompare.com.
United initiated the increase on Friday morning, followed by U.S. Airways Group LCC, +0.00%, Delta, Continental and American. Northwest was the last to match the increase, getting on board late Saturday.
"The increase was broad based, covering both leisure and business travelers. As usual in the past increases this year, legacy airlines have stepped lightly on competitive lower-cost airline city pairs," said FareCompare.com Chief Executive Rick Seaney in a statement.