International Air Transport Association (IATA), the apex global body of the airlines operators, has revised its industry financial forecast for 2008 significantly downwards to a loss of $2.3 billion.
This is a swing of $6.8 billion from the previous forecast industry profit of $4.5 billion announced in March and based on an average oil price of $86 per barrel, an IATA press release said today.
The current forecast uses a consensus oil price of $106.5 per barrel crude (Brent). "We also need to take a reality check. Despite the consensus of experts on the oil price, today's oil prices make the $2.3 billion loss look optimistic. For every dollar that the oil price increases, we add $1.6 billion to costs," IATA Director General and CEO Giovanni Bisignani said. If we see the price at USD 135 for the rest of the year, losses could be $6.1 billion, he said.
