Oil price hike translates into billions in added costs

Skyrocketing oil prices that followed the military intervention in Libya are having a devastating impact on the airfreight industry, says Iata director general and CEO, Giovanni Bisignani. “The first quarter ended with an average oil price of $106 per barrel. That’s a 33% increase on the $79.4 average for last year. And since fuel already accounts for about a third of an airline’s cost structure – and each dollar increase in the price of oil challenges airlines to recover $1.6 billion in added costs.”