Geneva - Global airline share prices weakened in July, underperforming other industries on the back of resurgence in fuel prices and softening demand while Initial Q2 industry profits were positive but down more than 20% on a year ago, though airlines in Asia-Pacific managed to improve performance, according to the latest statistics published by IATA (international Airline Transport Association).
Q3 has kicked off to a less than promising start, with several indicators threatening airline performance;
In particular, crude oil prices rebounded by 20% over the month in July, as oil supplies shrank after the UN embargo on Iranian oil exports came into effect.
The trend in passenger traffic growth has lost pace, now expanding at a slow 2% annualized rate since early 2012, although seasonally adjusted air freight levels continue to improve on the lows of late 2011.
Asset utilization in passenger markets weakened in June as load factors fell further in response to slowing demand, but cargo load factor rose as a result of solid traffic growth.
Worldwide airline fares continue to show weakness, and recent signs of softening demand could begin to undermine the persisting upward trend in US passenger yields seen to date.
The trend in US airline yields continues to be positive, although in the most
recent month there was a slight contraction of 1%.  High load factors
have been supporting the continued increase in yields throughout 2011 and
into  2012; however recent signs of demand weakening could undermine
this upward trend. 
Average worldwide fares  continue to show weakness, despite a slight uptick
in May, maintaining the  divergence to US  yields.  This suggests that regions
other than the US  have not had the same success in maintaining load
factors and profitability.