March 30 (Reuters) - Alaska Air Group on Monday estimated a bigger first-quarter loss as higher fuel prices due to the Iran war added to pressure from weaker demand in parts of its network.
Benchmark Brent has soared by about 58% this month, the steepest monthly jump in LSEG data going back to 1988, exceeding gains made during the 1990 Gulf War.
Alaska Air said economic fuel prices are expected to average $2.9 to $3 per gallon, creating an "incremental" earnings-per-share hit of at least $0.7.
The latest oil price spike could become the first real financial stress test for U.S. airlines since the pandemic, with weaker carriers more likely to shrink, borrow or absorb deeper losses while stronger rivals keep investing and gaining market share.
Alaska Air now expects an adjusted first-quarter loss of between $1.5 and $2 per share, compared with its previous estimate of 50 cents to $1.5.
Shares of the company were down 7.7% in morning trading. Its peers also sank.
Alaska said strong demand seen since late 2025 has recently been hit by external events, including weaker Mexico travel due to unrest in Puerto Vallarta and severe rainstorm and flooding in Hawaii, which together account for about 30% of its capacity.
"Impacts are being seen in both March and April, including during peak West Coast Spring Break travel periods," the company said.
However, corporate demand remained a standout, it said, with forward bookings over the next 90 days up more than 25% year-over-year.
The carrier said it was well-positioned for peak travel periods during its seasonally strongest quarter.
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