Why Higher Jet-Fuel Costs Are Clouding Delta (DAL)’s Near-Term Earnings Outlook

Delta Air Lines Inc. (NYSE:DAL) is one of the stocks most affected by inflation.

On March 20, 2026, Citigroup maintained its Buy rating on Delta but cut its price target to $77 from $87. Citi analyst John Godyn said the firm was updating estimates for higher fuel prices and now saw downside risk to first-quarter, second-quarter, and full-year 2026 estimates across nearly all airlines it covers.

That call landed in the middle of a sharp rise in jet-fuel costs tied to the Iran conflict and broader supply disruption fears. Reuters reported that U.S. airlines are now largely unhedged on fuel, leaving margins more exposed when oil and refined-product prices jump. Delta has some insulation through its refinery ownership, but it still faces meaningful cost pressure from higher fuel prices.

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The pressure is not theoretical. Reuters reported on March 17 that Delta expected a roughly $400 million increase in first-quarter expenses from surging jet-fuel prices, even as booking trends remained strong enough for the company to lift its revenue outlook. That combination helps explain Citi’s stance: demand is holding up, but fuel inflation is still squeezing earnings power in the near term.

Delta Air Lines Inc. (NYSE:DAL) is a major U.S. airline serving domestic and international routes, with hubs across key U.S. markets and operations spanning passenger and cargo air transportation.

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