Airline stocks gained Tuesday morning after Hurricane Gustav spared drilling platforms in the Gulf of Mexico, sending oil to a five-month low and improving the bottom line and earnings forecast for airlines and automakers.

At mid-day Northwest Airlines Corporation (NYSE: NWA) was trading up +11.09% at $11.51, UAL Corporation (NASDAQ: UAUA) was up +10.24% at $12.88, Delta Airlines (NYSE: DAL) was up 9.88% at $9.48 and AMR corporation (NYSE: AMR) was up 7.28% at $11.73.

Recently Lehman raised estimates for the Airlines based on reduced fuel costs and capacity reductions. The firm raised price targets for the following: Overweight rated DAL ($18 from $8.50), JBLU ($9 from $5.50), NWA ($19 from $10) and UAUA ($26 from $16.50); Equal Weight rated AAI ($4.50 from $4), ALK ($28 from $17), AMR ($22 from $7.50), LCC ($12 from $4); and Underweight rated CAL ($22 from $9.50)

Airlines recently reported earnings in line with consensus estimates. NWA reported earnings of ($0.55) on Wednesday (7/23/2008) with analyst looking for ($0.55). UAUA reported earnings of ($2.02) on Tuesday (7/22/2008) with analyst looking for ($2.02). AMR reported earnings of ($1.33) on Wednesday (7/16/2008) with analyst looking for ($1.33). DAL reported earnings of $0.05 on Wednesday (7/16/2008) with analyst looking for $0.05