Higher oil prices and credit-market turmoil prompted an international aviation trade group to sharply lower its 2008 profit outlook Wednesday, with U.S. carriers expected to be hit the hardest.
The International Air Transport Association estimated a global industry profit of $5 billion in 2008, down from previous guidance of $7.8 billion. The trade group maintained its forecast of a $5.6 billion profit this year, which will be the industry's first since 2000, as higher oil prices were more than offset by strong traffic and revenue growth.
But rising oil prices are expected to add $14 billion to the industry's total fuel bill of $149 billion next year, based on an average price of $78 per barrel. A barrel of light sweet crude for January delivery rose $2.34 to $92.36 in afternoon trading on the New York Mercantile Exchange, the AP reports.
The International Air Transport Association is an international industry trade group of airlines headquartered in Montreal, Quebec, Canada, where the ICAO also happens to be headquartered, even though they are different entities. The main objective of the organization is to assist airline companies to achieve lawful competition and uniformity in prices.
IATA was formed in April 1945, in Havana, Cuba. It is the successor to the International Air Traffic Association, founded in The Hague in 1919, the year of the world's first international scheduled services. At its founding, IATA had 57 members from 31 nations, mostly in Europe and North America. Today it has over 240 members from more than 140 nations in every part of the globe.
IATA assigns 3-letter IATA Airport Codes and 2-letter IATA airline designators, which are commonly used worldwide. ICAO also assigns airport and airline codes. For Rail&Fly systems, IATA also assigns IATA train station codes. For delay codes, IATA assigns IATA Delay Codes.
IATA is pivotal in the worldwide accreditation of travel agents with exception of the U.S., where this is done by the Airlines Reporting Corporation. Permission to sell airline tickets from the participating carriers is achieved through national member organizations.
Russian officials have repeatedly declared that Israeli aviation poses a threat to the Russian military in Syria.