Moody's cuts United Airlines' liquidity rating

The rating firm lowered the speculative grade liquidity rating to 'SGL-3' to 'SGL-2', and the outlook to negative from stable.

Moody's meanwhile affirmed the carrier's corporate family rating and other debt ratings, which remain at 'B2,' which is a speculative or "junk" rating.

Moody's said it lowered the outlook because it expects the airline's operating and financial performance to deteriorate.

"Weaker results are likely because of materially higher fuel costs, but also the weakening economic conditions that are likely to reduce demand and limit recovery of higher fuel costs by raising ticket prices. United also faces continued challenges to control the growth of unit costs," Moody's said.

On Wednesday, Moody's lowered Alaska Air Group Inc.'s outlook to negative, while Fitch Ratings cut JetBlue Airways Corp.'s debt ratings further into junk status on fuel and economic worries.

Shares of UAL, the second largest U.S. carrier, rose 15 cents to $14.32 in midday trading.