SAN FRANCISCO (MarketWatch) — Given the rash of headlines about pilot meltdowns, usurious baggage fees and toddlers popping up on TSA no-fly lists, you’d think the airline industry is spiraling into another vicious crisis cycle.

Not entirely. Despite a barrage of negative publicity, most airlines are doing fine. And with oil prices tumbling Wednesday below $90 a barrel in New York for the first time in seven months, their prospects just got a little brighter.

Fuel has long been one of the industry’s biggest costs, typically second only to personnel outlays. So just as the industry gears up for peak summer travel, the commodities market is handing over a timely windfall. July crude-oil in New York closed at $89.91 a barrel Wednesday, topping off a stunning 14% retreat in less than a month.

This comes on top of strong spring bookings for the industry. A note from Deutsche Bank Wednesday points out that consolidated-passenger-unit revenue for U.S. airlines rose 8.4% in April from a year ago, better than most analysts expected. This follows a 6.7% increase in February and an 8.2% increase in March. So momentum clearly has been building.

At the same time, years of industry consolidation and seating-capacity cuts have finally made it possible for airlines to jack up fares and make them stick. These higher prices and lower costs raise the likelihood of top-line revenue growth for many carriers, which will help them pay for all the new, more fuel-efficient jets they’ve ordered.

It’s impossible to know how all this will shake out over the next few months. But heading into Memorial Day, the unofficial kickoff of summer, airlines are probably feeling more confident about their prospects than they were a month ago.

And that confidence is spilling over to investors. The NYSE Arca Airline Index is up 8.7% so far this year, compared with a 1.2% decline by the Dow Transport Average and a 0.8% drop by the S&P 500 Index.

US Airways has led percentage gainers in the group, up a whopping 113% so far this year, followed by a 32% advance by Delta Air Lines and nearly 17% increase for United Continental — all strong showings when stacked up against the broader equities market.