Oil rocks airlines

SINGAPORE/PARIS (Reuters) – Airlines around the world braced for slower growth, tighter earnings and deeper cost cutting on Thursday as oil prices surged and the biggest carrier by revenue, Air France KLM, warned on profits.

Oil’s spike to a record $135 a barrel knocked airline shares worldwide, with top U.S. carrier American Airlines revealing its sharpest cutbacks since the hijack attacks of September 11 2001, including thousands of job cuts.

Air France KLM’s chief executive, Jean-Cyril Spinetta, warned the airline would have to expect a 1.1 billion euro (873 million pounds) rise in fuel costs, squeezing profits this year and forcing it to find 150 million euros in savings.

Reuters