International Air Transport Association said yesterday that industry earnings suffered the first year-on-year decline for two years in the three months to June as fuel costs rose and capacity increases outstripped demand. Early figures for 16 carriers showed operating profit shrinking by one-third and net income tumbling by almost two- thirds. North America, the Asia-Pacific region, and Latin America are all showing declines, while European earnings advanced only because traffic disruption caused by a volcanic ash from Iceland crimped profit last year. Is anyone surprised by this news? You shouldn’t be. J.P. Morgan yesterday revised downward the outlook for airlines

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