Fuel's paradise As crude-oil prices - and the cost of jet fuel - have fallen, carriers' stocks have been soaring. Some analysts say they believe the easing will even put some airlines into the black in 2009. Not everyone is convinced.

Airline stocks soared in recent days, as crude-oil prices fell to $113 a barrel yesterday. Several analysts suggested that declining jet-fuel costs could put some airlines in the black next year and lead to brighter flying days ahead.

"At $115 a barrel, we see the industry turning a profit in 2009," a Morgan Stanley analyst said in a research report. The recent drop in oil prices, "if sustained, is a game-changing event for the industry."

But not everyone is convinced. UBS Investment Research analyst Kevin Crissey said he remained "concerned that revenue will disappoint in the coming quarters," despite aggressive cuts in flights and schedules and added fees for everything from checked bags to sodas.

Standard & Poor's credit-rating service said the industry remained fragile. Consumer spending is down; corporate travel is off. And oil remains in historically high territory. "We are not as convinced" as some are "that fuel is on a downward trajectory," said S&P credit analyst Betsy Snyder.

Airline shares have been rising since mid-July on falling oil prices and amid airlines' moves to reduce seats, raise fares, and charge passengers new fees.

US Airways Group Inc. shares had fallen July 15 to $1.76. Yesterday, they closed up almost 12 percent for the day, at $9.39.

"This isn't the same industry that gave us pause last March," JPMorgan Chase & Co. analysts Jamie Baker and Mark Streeter said in a note yesterday to clients.

The recent drop in crude oil represents $13 billion in reduced annual expenses for airlines, JPMorgan said. "This represents both the most rapid and most significant expense savings ever realized for the airlines."

The major airlines have cut 8 percent of their capacity - seats and flights - and their liquidity has been bolstered by added revenue from new fees, Baker and Streeter said. They upgraded airlines' creditworthiness to "overweight" from "underweight."

Morgan Stanley analyst William Greene said US Airways and United Airlines were poised to "benefit most" from more favorable financial expectations. He expects Continental Airlines Inc., Delta Air Lines Inc. JetBlue Airways Corp., Southwest Airlines Co., Northwest Airlines Corp. and UAL Corp., United's parent, to post profits in 2009, if oil remains around $115 a barrel. Greene predicted losses would continue next year for US Airways, Philadelphia's dominant airline, and for American Airlines.