Travel trembles as fuel prices, TSA callouts & economic clouds gather

Soaring energy prices as a result of the conflict in Iran are taking their toll on the global economy, with everything from fertilizer makers to chipmakers to homebuilders affected by the shock.But for consumer brands such as airlines, cruise lines, and hospitality names, the precarious picture keeps dimming.What's going on with travel stocks?On Friday, cruise lines Norwegian Cruise Line Holdings (-6.8%), Carnival Corp (-5.44%), and Royal Caribbean (-4.56%) were among the worst performers in the S&P 500. They were joined by hospitality company Airbnb (-6.35%) and airlines Southwest Airlines (-5.36%) and United Airlines Holdings (-4.75%).Outside of the S&P 500, matters have not been much better. Clear Secure (-10%), which has been a portfolio hero amid the market's tepid quarter, fell by double digits on Friday amid concerns about airport security. Alaska Airlines (-8%) saw some of the steepest losses among travel brands, hitting a 52-week low.The U.S. Global Jets ETF ($JETS) is down 14.5% year-to-date. Another index tracking airlines, hotels, and cruise lines -- SonicShares Airlines, Hotels, Cruise Lines ETF ($TRYP) -- is down 20.6% year-to-date.What's wrong in the travel industry?First, it was the energy costs. Higher costs are already exacting a toll on travel brands, since fuel costs represent a significant share of their expenses. The result will be higher prices for consumers, which could weaken demand for travel products. That has begun to be felt across the travel marketplace. Making matters worse, a funding shortfall for the Department of Homeland Security (DHS) has meant that airport security workers have been unpaid for over a month. That's because the Transportation Security Administration (TSA) sits under the DHS. As a result, many TSA workers have called out or outright resigned from service.Related: TSA changes & announcements during Trump's presidency: A timelineSome problems can be solved quicklyDespite hope for a swift resolution, America's conflict in Iran is now a month old. At this point, it's no longer a case of "nothing ever happens." Investors' initial ambivalence towards the Iran conflict is finally being met by reality.U.S. equity benchmarks such as the Russell 2000, Nasdaq Composite, and now, the Dow Jones Industrial Average have all entered correction territory. That's defined as a 10% drawdown from all-time highs. And those losses could continue as Brent Crude remained above $105/bbl on Friday.However, despite the self-inflicted blunder the U.S. is nursing in the Middle East, there is hope for a resolution to the more acute problem afflicting airlines. Namely, the problem in security lines, which might be deterring some from traveling.The TSA trouble explainedIn recent weeks, lengthy lines as a result of TSA callouts have created, at best, mild disruption at airports across the country. In airports like Houston's IAH, it's been more like a serious disruption, with wait times exceeding four hours.On Thursday, President Donald Trump begrudgingly signed an executive order that intends to pay Transportation Security Administration (TSA) agents. In a statement, the DHS said it will pay 50,000 TSA officers "as early as Monday." However, it remains to be seen where that money will come from. And further, it will take many take up to a week for all paychecks to go out due to "payment processing limitations," per Thrifty Traveler's Kyle Potter.This means it may take many days to get paychecks to TSA agents and convince them to return to work.But beyond executive action, a long-term solution to the ongoing funding problem at DHS falls to Congress. It was thought they might have a solution as Senate Republicans and Democrats united to unanimously pass a bill that would provide funding to the TSA, FEMA, and other branches.House Republicans ultimately declined to take up the bill, assuring that at least two more weeks could go by before a serious solution could take shape.