Airlines struggling with fuel costs

? Katrina forced scores more flight cancellations involving New Orleans and other Southern cities Tuesday as airlines juggled their schedules around one of the worst storms on record.

Hurricane-related disruptions also continued to have an impact far more worrisome for U.S. carriers than added costs and lost revenue from the flight turmoil: oil prices that spiked to record highs over $70.

“Overall the storm will hurt, but it’s certainly not the same as the impact of rising oil prices,” said Philip Baggaley, airline analyst for Standard & Poor’s Corp. Any further significant increase, he said, will have “a large effect.”

Those consequences include potentially pushing Delta Air Lines Inc., Northwest Airlines Corp. and Independence Air operator FLYi Inc. into bankruptcy as well as stymieing the efforts of United Airlines parent UAL Corp. and US Airways Group Inc. to emerge from Chapter 11 successfully.

Travelers check the departure monitors for any Hurricane Katrina-related delays or cancellations at the American Airlines terminal at Chicago's O'Hare International Airport. There were more flight cancellations involving New Orleans and other Southern cities as airlines continue juggling their schedules Tuesday.

“Today’s jet fuel prices are crushing and could prove to be a knockout blow for some,” said economist John Heimlich in a report for the Air Transport Assn.

For the short term, airlines were scrambling to rearrange flights within the limitations set by Katrina’s devastating path and airport closures. The Federal Aviation Administration said two commercial airports remained closed – in New Orleans and Gulfport, Miss. – with storm-related delays reported at Atlanta’s Hartsfield International Airport.

Some flights were restored to cities in the Gulf Coast region where service was canceled a day earlier.

But there were indications that flight disruptions would last into the Labor Day weekend.