SINGAPORE, Feb. 18--Tough times are ahead for global aviation despite a return to profit last year, with many airlines mired in debt, rising fuel bills and fears of a looming US recession, industry officials said Monday.
The global aviation industry returned to profitability in 2007 but earnings of $5.6 billion were only less than two percent of $490 billion in revenue, said International Air Transport Association (IATA) chief Giovanni Bisignani, AFP wrote.
“Tough times will continue... Airlines may be out of intensive care but the industry is still sick,“ he warned in a speech at an aviation conference being held as part of the Singapore Airshow.
“Airlines are in $190 billion of debt. Oil is pushing $100 per barrel accounting for 30 percent of operating costs or a total bill of 149 billion dollars.
“The revenue cycle peaked in 2006 and the negative impact of the credit crunch is still being calculated,“ he said, referring to the global financial market turmoil triggered by massive defaults on risky US home loans.
Global aviation suffered following the September 11, 2001 attacks in the United States in which militants used hijacked passenger planes as airborne weapons.
IATA estimated overall losses for the global industry at $40 billion.
Despite the gloomy global picture, Asia’s aviation industry can fare better, thanks to rapidly expanding markets in China and India, Bisignani said.
Asia is “home to some of the industry’s strongest carriers and best and newest airport infrastructure,“ he added.
But while the region is “full of promise“, there were also “some very big challenges,“ Bisignani said. He sounded warning bells on the emerging challenge from the Middle East, which he said is spending $38 billion on airports and other aviation infrastructure.

CARACAS, Venezuela,
Feb. 18--President Hugo Chavez sent a soothing message to American motorists, saying that Venezuela is not preparing to cut off oil shipments to the United States.
The socialist leader rattled oil markets when he threatened a week ago to halt shipments to the United States in retaliation for Exxon Mobil Corp.’s success in convincing courts in the US and Europe to freeze Venezuelan assets, AP wrote.
“We don’t have plans to stop sending oil to the United States“, Chavez said Sunday during a visit to heavy-oil projects in Venezuela’s petroleum-rich Orinoco River basin that were nationalized last year.
But he added that Venezuela could cut off supplies to the United States if Washington “attacks Venezuela or tries to harm us“.
Chavez has repeatedly warned against a possible US invasion to seize control of Venezuela’s immense oil reserves. US officials have denied any such plan exists.
The United States relies on Venezuela for about 10 percent of its oil imports.
Venezuela may create a windfall tax on oil profits generated by rising oil prices, Chavez said, extending the OPEC nation’s efforts to increase revenue from the oil industry.
The leftist leader said Venezuela could sue Exxon Mobil for unpaid oil taxes, just days after revelations that Exxon won court orders freezing up to $12 billion in Venezuelan assets to ensure compensation for a nationalized oil project, Reuters wrote.
The windfall tax would represent the fourth increase in oil taxes in as many years as part of Chavez’s drive to increase revenue from the oil industry and increase state control over oil fields, a crusade that sparked the current legal tussle with Exxon.
“If the price of oil continues to strengthen between $80 and $100 per barrel, I think it is necessary to apply this tax,“ Chavez said during his weekly broadcast held at the Cerro Negro oil project once run by Exxon.
Chavez in 2004 raised royalties on four heavy oil projects, and in 2006 created an “extraction“ tax and boosted income tax on the same projects.
He did not offer details on the tax, but said it would require increased payments at times of higher prices.

Conservatives have rejected the move as ÒcatastrophicÓ.

LONDON, Feb. 18--Northern Rock is to be nationalized as a temporary measure, Chancellor Alistair Darling has said.
Neither of the two private proposals to take over the beleaguered bank offered “sufficient value for money to the taxpayer“, Darling was quoted by BBC as saying.
He said the public would gain if the government held on to Northern Rock until market conditions improved.
Ron Sandler, nominated by the government to run Northern Rock, said savers’ deposits would be secure.
But shadow chancellor George Osborne told the BBC that the Conservatives would oppose plans to nationalize Northern Rock.
“After months of dither and delay we have ended up with this catastrophic decision,“ said Osborne.
“We now have the situation where the government will be making decisions on whether or not to foreclose on people’s loans in a falling housing market,“ he added.
A consortium led by the Virgin group was leading bids to run the beleaguered bank, while a management buyout had also been considered.
But ministers have decided that nationalization--the first such move since the 1970s--was the only option.
Virgin boss Sir Richard Branson criticized the government’s decision, “We believe we had a very strong proposal, an experienced team and one of Britain’s best brands.“We believe nationalization is not the right answer and that a commercial solution would have been the best way forward.“
Explaining the government’s decision, Darling said, “It is better for the Government to hold on to Northern Rock for a temporary period and as and when market conditions improve the value of Northern Rock will grow and therefore the taxpayer will gain.“ “The long-term ownership of this bank must lie in the private sector“.
Northern Rock got itself into financial difficulties last year because its business model left it ill-prepared for the global credit crunch.
It was forced to ask the Bank of England for emergency funding, triggering the first run on a British bank in more than a century.
Nationalization was expected to be pushed though parliament with emergency legislation on Monday.
Under nationalization rules, shareholders will be offered compensation for their holding, at a level set by a government-appointed panel.

RIYADH, Saudi Arabia, Feb. 18--Saudi Arabia will hold off on revaluing its currency against the flagging US dollar despite soaring inflation, the oil-rich kingdom’s finance minister was reported as saying on Sunday.
At a closed session of the appointed Shura (consultative) Council, Ibrahim Al-Assaf said Riyadh would not revalue the riyal, which is pegged to the dollar, at the present time, the head of the council’s financial committee, economist Ihsan Bu Hulaiga, told AFP.
The dollar is worth 3.75 Saudi riyals, the rate used for around 15 years.
Bu Hulaiga said Assaf made his remarks during a session of the Shura Council, which has an advisory role, at which the governor of the central bank, Hamad Al-Sayari, also spoke of efforts to curb inflation.
Inflation hit 6.5 percent in Saudi Arabia in December, the highest level in 16 years.
Kuwait is so far the only member of the Persian Gulf Cooperation Council--which also groups Bahrain, Oman, Qatar, Saudi Arabia and the United Arab Emirates--to have dropped the dollar peg in favor of a basket of currencies.
Since Kuwait de-pegged from the greenback in May 2007, there have been recurrent press reports about planned similar moves by other PGCC states as well as about plans by various member states to revalue their currencies.
PGCC leaders decided at their annual summit in Qatar in December that their currencies, except for Kuwait’s, would remain pegged to the US currency despite its depreciation.
PGCC states, which are US allies, are experiencing high growth rates of between 4 and 8 percent because of rising oil revenues that have boosted liquidity to new levels.
But inflation has also risen to double digits in some of them as a result.
The International Monetary Fund expects overall PGCC inflation to rise to 6 percent in 2008, but consumer prices in some member states, like the UAE and Qatar, have run at higher levels, registering 9.3 percent and 11.8 percent respectively in 2006.

SINGAPORE, Feb. 18--Platinum hit a record high for the 13th successive day on Monday on lingering power supply shortages which have disrupted mining in main producer South Africa.
Platinum, used in jewelry and auto catalysts, has gained more than 20 percent since late January and more than 30 percent in 2008 after South Africa, which accounts for 80 percent of global supply, was hit by power cuts that forced mines to shut for five days last month, Reuters reported.
Spot platinum hit a high of $2,087 an ounce, driven by investor buying and purchases from auto makers, up from $2,050/2,055 an ounce late in New York on Friday.
Palladium jumped to its highest level in more than 6 years at $450 an ounce to track its sister metal platinum.
“At this moment, nobody knows the future price of platinum, but I personally presume it will be $2,100 at the end of this month,“ said Yukuji Sonoda, precious metals analyst at Daiichi Commodities in Tokyo.
“In Japan, many automobile companies are very nervous about future platinum prices. They will increase stocks for another two or four months. I personally think there’s a minimum deficit of 11 tons (353,657 ounces),“ said Sonoda, referring to his forecast for the 2008 global supply deficit.
Mines across South Africa have been hit by a lack power after state utility Eskom asked the mining sector to cut power use to 90 percent of normal needs to ease a nationwide shortage caused by the failure of electricity generation to match economic growth.
Other analysts say the global platinum deficit could widen to 400,000 to 500,000 ounces by the end of 2008, compared with about 265,000 ounces in 2007. The market had a surplus of 65,000 ounces in 2006 following seven successive years of deficit.

ALGIERS, Algeria, Feb. 18--A new energy organization for Africa tasked with coordinating policy for the resource-rich continent was set to be launched Sunday at a meeting of African Union energy ministers, organizers said.
The African Energy Commission (AFREC) is to be headquartered in Algiers and is to promote the sharing of information about policy among members, AFP reported.
The acting head of the organization, Hussein Elhag, said the AFREC would also promote alternative energy in African countries, including nuclear energy for countries that wanted to harness it for peaceful means.
“The AFREC is a special forum to elaborate and put in practice energy policy“ for Africa, said Algerian Energy Minister Chakib Khelil.
The continent counts a number of established oil and gas exporters, such as Algeria, Nigeria and Libya, as well as emerging powers such as Angola, Sudan or Sao Tome.
Elhag said African countries produced about nine million barrels of oil a day, but consumed only three million of this.
“The energy question is a global strategic challenge. Africa, with its resource potential and the outlook for its needs in the long-term, is concerned in the first degree,“ added Khelil.
About 30 energy ministers from African Union countries are in Algiers for the meeting. They have been joined by representatives from other regional and international energy groups, as well as international financial institutions.
The agenda for the meeting, including the budget, organization and governance of AFREC, was drawn up on Friday and was set for discussion by ministers on Sunday.

A pressure valve is seen on a gas pipeline in the vicinity of the town of Boyarka, near Kiev, Feb. 12.

BRUSSELS, Belgium, Feb. 18--Most voters in five major European countries are wary of Russia as a supplier of their energy needs, according to a poll published Monday, AFP reported.
The Financial Times/Harris survey also found that, despite their unease, those same west Europeans were opposed to paying more, if at all, to switch to renewable sources.
Overall, a majority of respondents in Britain, France, Italy and Germany were opposed to Russian companies investing in their countries.
Only Spain bucked the trend: 55 percent of Spaniards welcomed investment from Russia.
Despite the unease towards Russia as an energy provider, only in Britain did a majority of respondents, 60 percent, regard Russia as a foe rather than a friend.
When it comes to using renewable energy as a rival to Russian energy, the majority of respondents with bill-paying responsibility in their houses said they would not pay more for energy from renewable sources.
A majority of those that said they would pay more, meanwhile, said they would only accept price increases of 5 percent.
In all the five European countries, along with the United States, a clear majority favored increased investment in wind farms. Germany at 79 percent was the lowest, while the US was highest with 92 percent of respondents favoring such proposals.
An overwhelming majority also backed cutting taxes on low-polluting cars.
The FT/Harris poll questioned 6,448 people over the Internet between Jan. 30 and Feb. 8.

SYDNEY, Australia, Feb. 18--Investments in Australia by foreign state-owned wealth funds will face close scrutiny, Prime Minister Kevin Rudd said Monday, in the wake of China’s move into mining giant Rio Tinto.
While stressing that he was not commenting specifically on “current moves on the part of particular companies,“ Rudd said he wanted to talk to Beijing’s leaders about China’s future plans for investment in resources, AFP wrote.
“How do we fashion this long-term energy and resource relationship between our two countries?“ he asked in an interview with the Australian Broadcasting Corporation.
“China does depend on reliable sources of supply from Australia in a whole range of commodity areas. This will continue into the future and what I want to talk to the Chinese leadership about is what’s their long-term strategy, and what are this country’s long-term strategic interests as well.“
China’s insatiable hunger for resources to fuel its rapidly-growing economy has driven a mining-backed boom in Australia in recent years.
State-owned aluminum giant Chinalco, acting with US-based Alcoa Inc, bought 12 percent of the London-listed shares of Rio Tinto, the world’s third-biggest miner, for $14 billion in a sharemarket raid earlier this month.