ATA
28/05/2008
On May 23, crude oil closed at $131.19, up $18.73 in less than a month
– more than double the price at which it sold last year.
As a result, the portion of an airline ticket needed to pay for fuel has risen from 15 percent in 2000 to 40 percent in 2008
– and it continues to climb. Airline stock analysts suggest that to survive
– not to make a profit –
the industry will have to reduce capacity by about 20 percent, which means fewer flights, more crowded flights, fewer hubs, elimination of all air service to some smaller cities
– with devastating economic consequences to local economies
– and potentially higher fares.
