Giovanni Bisignani Oil Quotations

We fully understand the principles of supply and demand. But it is difficult to see this as anything other than a $14 billion cash grab by the oil industry that is pouring salt into the wounds of a global crisis.

Each dollar added to the price of a barrel of oil adds $1 billion in costs to the industry.

Oil is once again robbing the industry of a return to profitability, ... Each dollar added to the price of a barrel adds $US1 billion in costs to the industry.

Oil is now destroying our profitability. We are in an emergency mode.

Oil remains the wild card for industry profitability. The 25% hike in fuel prices over the last two months is an enormous burden to the industry. However, the S$ 1.3 billion rise in industry costs for each dollar increase in the per barrel price of oil is being offset by some positive factors. Industry hedging levels are 50%. Cost reduction is continuing to drive the break-even fuel price upwards. And the US domestic yield rose 12.4% in February.

Oil remains the single-biggest challenge for airline profitability. Strong demand gives little hope of significantly reduced prices this year. What is disappointing is the response of the oil industry. Instead of expanding refinery capacity, the oil companies plan to return a quarter of a trillion dollars to investors over the next two years. Airlines alone have contributed $14 billion to this windfall profit. It is time that governments stepped in to encourage investment in new refinery capacity along with research into alternative fuel sources.

Oil is once again robbing the industry of a return to profitability. Cost reductions and efficiency gains have never been more critical.