Geneva - Revenues of airlines are expected to fall by an average of 6 per cent next year, an outlook released Tuesday said, as passenger and cargo traffic is likely to drop.

The International Air Transport Association said in its 2009 forecast the industry would expect to lose 2.5 billion dollars.

"We face the worst revenue environment in 50 years," said Giovanni Bisignani, the IATA's chief.

"The industry remains sick," he said and added that "it will take changes beyond the control of airlines to navigate back into profitable territory."

The drop in oil prices, from a peak of nearly 150 dollars a barrel over the summer to their current rates at slightly above 40 dollars, had only marginally cushioned the economic crisis, with the total losses for this year standing at about 5 billion dollars.

The IATA said it expected oil to sell for about 60 dollars a barrel in 2009.

North American carriers suffered the most in 2008, in part due to poor hedging on oil while the prices soared upwards.

That is now playing in their favour as the cost comes down, and combined with an early reduction in sales, expected to mean an earlier head start on recovery, the airlines in that region are likely to post a small profit next year.

Europeans, who hedged themselves well on oil, a move which favoured them in the first half of the year, are now suffering as a result with their effective savings only about half of what they could have been.

The weakened euro is also taking a toll and airlines in Europe are expected to post losses of over 1 billion dollars.

Latin American and Middle Eastern airlines are forecasted to see losses double and Africa's carriers will likely lose 300 million dollars. Asia-Pacific will see losses double to over 1 billion dollars next year.

Globally, passenger traffic is expected to decline 3 per cent and cargo by 5 per cent in 2009, having already dropped significantly in the past three months, as different regions went into recession or a period of stunted growth. (dpa)