Impact of fuel price fluctuations on airline stock returns

Werner D. Kristjanpoller and Diego Concha

Applied Energy, 2016, vol. 178, issue C, 496-504

Abstract: This paper analyzes the impact of changes in fuel price on the equity returns of airlines associated with International Air Transport Association (IATA), as listed on the stock market. While it is simple to comprehend that airline price stock returns are related to fuel price variations, it is not as simple to establish whether this relationship is direct or indirect. It could be assumed to be indirect given the high influence of fuel price on airline costs. However, when taking into account the market inertia theory and the paradigm that increases in oil price are indicators of economic growth, these relations could also be assumed to be direct.

Keywords: Oil shocks; Airline stocks; CAPM extended (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (30)

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DOI: 10.1016/j.apenergy.2016.06.089

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