Delta loss as fuel prices surge

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US firm Delta Air Lines has reported a loss for the last three months of 2007, following a surge in fuel costs.

Delta, which emerged from bankruptcy in April, saw a $70m (£35.9m) quarterly loss, but it was less than the $1.98bn loss seen a year earlier.

The carrier's moves to raise ticket prices to counter energy costs have proved unsuccessful, as consumers cut their spending amid a wider slowdown.

American Airlines and United Airlines have also seen quarterly losses.

Price hedge

Delta's chief financial officer, Ed Bastian, said the firm would reduce its domestic service, and was prepared to "quickly make further adjustments as the domestic economic outlook warrants".

The airline's fuel bill for aircraft, incluiding associated taxes, hit $1.36bn, a marked rise from the $1.06bn for the same period in 2006.

However, Delta said revenue for the three months to December 31 climbed 10% to $4.68bn, helped by more flights internationally, notably to Asia and across the Atlantic.

Delta unsucessfully tried to merge with another US carrier in 2007.

Southwest up

In contrast to Delta, budget carrier Southwest airlines reported a quarterly profit.

Southwest airlines saw its profit rise to $111m, up from $57m a year earlier, after successfully hedging its fuel prices.

The firm signed contracts guaranteeing that 90% of its oil would cost about $51 a barrel for the fourth quarter of 2007.

Looking ahead, the firm has 75% of its jet fuel secured at that price for the first quarter of 2008, making it far cheaper than the current price of oil, which is hovering about $88 a barrel.