OIL PRICE EXPECTED TO HIT AVERAGE OF US$75 PER BARREL IN 2010

From Saraswathi Muniappan

GENEVA, Dec 15 (Bernama) -- An average oil price of US$75 per barrel (Brent)
is expected in 2010, up considerably from the US$61.8 average expected for 2009.

Therefore, as a percentage of operating costs in the aviation sector, fuel
will account 26 per cent in 2010, said IATA's director general and chief
executive officer, Giovanni Bisignani during a conference here, Tuesday.

This is however, considerably lower than the 32 per cent of operating costs
that fuel comprised in 2008, but twice the 13 per cent of operating costs that
fuel represented in 2001-2002.

As for cash, he said the industry raised at least US$38 billion this year,
of which US$25 billion came from capital markets and US$13 billion from
aircraft sale and leasebacks.

The ratio of cash to revenues improved for European and North American
airlines but was flat for Asia Pacific carriers. This will provide a cash
cushion for the approaching first quarter's seasonably weak traffic lows.

"The number of travellers will be back to peak levels of 2007, but with
US$30 billion less in revenues. The US$38 billion cash cushion built up
throughout this year will help airlines survive through the low season, but
there is no recovery in sight for 2010. Tough times continue," said Bisignani.

-- BERNAMA