<WIRE> Cruise Operators Suffer Amid Rising Fuel Costs due to Middle East Conflict

Cruise operators are experiencing a downturn due to rising fuel costs amid escalating conflict in the Middle East.

Shares of Norwegian Cruise Line (ASX:NCLH) fell almost 5%, while shares of Carnival and Royal Caribbean Group also fell 6% and 4% respectively.

Oil prices experienced a surge of 4% following an unexpected attack by Hamas on Israel last weekend, inciting fears of an extended conflict in the Middle East.

This increase in crude oil prices could compound preexisting elevated fuel costs for cruise lines.

Earlier in September, Carnival expected a larger than anticipated loss for Q4, predicting a net impact of $130 million due to soaring fuel prices and unfavorable exchange rates.

According to an email statement, Royal Caribbean is ‘closely watching’ the situation in Israel and modifying several itineraries in the region.

The company stated that affected guests are being directly contacted.

Carnival mentioned in a statement that it has ‘adjusted’ its cruise itineraries and will not be making calls to Israel at the current time.

Norwegian Cruise Line (ASX:NCLH) did not immediately respond to requests for comments on how the conflict would impact operations in the region.

Wells Fargo estimates that NCLH will be most impacted by the conflict, followed by Royal Caribbean and then Carnival, predicting pressure on Q4 and Q1 pricing.

Year To Date, stock performance has seen Carnival up by around 65%, Royal Caribbean up 84%, and NCLH up 36% through the last close.

Norwegian Cruise Line is a global cruise company that is extensively recognized for its Freestyle Cruising concept.

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