The Ratings Game: Airlines feel the pinch of rising fuel prices, passengers will feel it next

Surging fuel costs prompted yet another air carrier to cut its financial outlook Thursday, but airline stocks rallied as analysts looked to increased ticket pricing to balance out the effect going forward.

Delta Air Lines Inc. slashed its guidance range for 2018 per-share earnings to $5.35 to $5.70 from the previous estimate provided in January of $6.35 to $6.70, as the carrier now expects a $2 billion higher fuel bill this year.

For the second quarter, Delta said it paid an average $2.17 a gallon for fuel, above the estimate provided in April of $2.07 to $2.12, and well above the $2.01 it paid in the first quarter.

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