Airline stocks pulled back sharply Tuesday as oil prices surged to a new record near $130 a barrel.
The Amex Airline Index dropped 3.6 percent to 21.19 at midday. Broader indicators also declined, with the Dow Jones industrial average down 1.4 percent to 12,851.89.
Oil prices shattered another record, rising as high as $129.60 on the New York Mercantile Exchange before settling back to $129.43, up $2.38.
Airline stocks typically move opposite oil prices because fuel represents one of the industry's biggest costs.
The battered industry got more bad news Tuesday when the University of Michigan released a survey that found passengers are more dissatisfied with airlines' customer service than they have been since 2001. United Airlines and US Airways Group Inc. finished next-to-last and last, respectively, in the university's American Customer Satisfaction Index.
Shares of United parent UAL Corp. sank 89 cents, or 7.2 percent, to $11.53. US Airways fell 40 cents, or 5.5 percent, to $6.91.
A separate report, by the International Air Transport Association, found that the number of global travelers flying business or first-class fell in March for the first time in five years. Airlines rely on high-paying passengers in the front of the plane for a significant portion of their revenue.
Among other decliners Tuesday, American Airlines parent AMR Corp. dropped 55 cents, or 6.3 percent, to $8.18. Delta Air Lines Inc. lost 32 cents, or 4.5 percent, to $6.83, and Continental Airlines Inc. fell 41 cents, or 2.4 percent, to $16.48.
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