US: Crude oil at one-year highs is just one of the many problems airlines face, portfolio manager warns

West Texas Intermediate crude touched highs not seen since January 2020, setting airlines up for a quandary — absorb that cost or pass it on to a consumer already wary of flying during a pandemic. Add that to the industry’s list of headwinds, Washington Crossing Advisors portfolio manager Chad Morganlander said Wednesday. “This is just one of a litany of concerns when it comes to the airline industry. We would avoid these companies and that group,” he said. “We believe that these companies have way too much debt. They have high embedded costs structures, making them less flexible and less profitable when you have the situations like oil going higher.” The airlines are still well off their pre-pandemic highs even as the S&P 500 has rebounded to touch fresh records this year. The JETS global jets ETF, which holds stocks such as Delta and United, has bounced nearly 100% off its March low but remains 30% from a high set a year ago. Currently trading at $22.38, it would need to rally 55% to catch up to its record set at the beginning of 2018. <br/>