Gulf airlines see dip in demand during July

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Middle East airlines saw a drop in passenger demand in July compared to the previous month due to the timing of Ramadan, the International Air Transport Association (IATA) has said.

The region's carriers still experienced the highest growth rate for any region, with July traffic up 7.8 percent compared to a year ago.

"While this is a fall-off from even higher year-over-year growth in June (12.1 percent), part of the decline can be attributed to the timing of Ramadan, which has a dampening effect on demand," IATA said in a statement.

In 2013 Ramadan spanned most of July whereas in 2012, it occurred mostly in August. Capacity growth of 10.5 percent sent load factors down two percentage points to 78.3 percent.

Globally, overall revenue passenger kilometres (RPKs) were up five percent compared to July 2012, IATA said.

All regions were up year-on-year, with emerging markets recording the strongest increases. Capacity rose 5.5 percent on the previous July, ahead of demand, and industry load factor dropped 0.4 percentage points to 82.4 percent.

“Passenger demand continues to be strong. But the story of emerging markets driving growth as developed economies stagnate could be shifting. We are still expecting growth of 5 percent this year. How that growth is achieved, however, appears to be at a turning point,” said Tony Tyler, IATA’s director general and CEO.

“The emergence of the Eurozone from an 18-month recession provided the biggest boost to traffic over recent months. In contrast, the deceleration of the Chinese economy has been a dampener on air travel,  with weakness showing up throughout emerging Asian markets."

He added: "The price of oil, a huge cost item for airlines, is tracking political tensions in the Middle East. Along with the global cost impact of this, at the regional level there is the potential for disruption for one of aviation’s strongest and most consistent growth markets.”

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