Soaring jet fuel taints airline profit outlook
CHICAGO (Reuters) — As jet fuel prices continue to soar, the chances that the U.S. airline industry will return to profitability this year are slipping, anal cysts said.
To make matters worse, not many airlines have sufficiently hedged their exposure
to rising jet fuel prices, leaving them open to the risk of even higher prices.Jet fuel — at its highest level in a year — makes up 12 to 14% of airlines' operating costs
and is their second-biggest operating expense after labor. High fuel prices are the latest challenge for the industry, which has been struggling with weak revenue and soft demand for more than two years.
"It's a major concern," said Blaylock & Partners anal cyst Ray Neidl. "If fuel prices stay at current levels and airlines cannot pass these fuel costs on to consumers ... then the industry will not return to profitability this year."http://www.usatoday....-jet-fuel_x.htm