As it holds its annual meeting in Beijing today, IATA has almost doubled its loss forecast for European airlines for this year. Its previous forecast just three months ago was for a $600 million loss. Now the body says that airlines in Europe may lose $1.1 billion in 2012. Globally, IATA forecasts a global profit of $3 billion, but warns that if Europe's debt crisis worsens it could of course cancel any expected worldwide profit. The forecast is already a substantial fall from last year's $7.9 billion profits.
Andrew Herdman, head of the Association of Asia Pacific Airlines said that for Asian carriers there is "a contagion effect of reading about political uncertainty and economic slowdown elsewhere."
IATA is basing its earnings forecast on the assumption that Brent crude will average $110 this year, according to Bloomberg.