Jet Airways FY11 loss narrows; rising crude still a worry

India's No. 1 carrier Jet Airways Ltd  on Thursday posted a narrower loss for the full year ended March, aided by cost-cuts and route rationalisation, but warned that rising crude prices could impact traffic growth in the near term.

"To the extent crude oil prices and fares continue to remain higher, it could impact some traffic growth in the short term though the medium term growth outlook remains intact," Jet said in a statement.

Rising oil prices -- coupled with unrest in the Arab world -- could wipe out airline profitability in 2011 and hinder the industry's recovery, airline body IATA said last month.

International oil prices hit a 2-12 year high last month as unrest spread in North Africa and the Middle East and fanned concerns supply could be disrupted.

"Due to other macro economic conditions, discretionary spending on travel could get affected in the short term. The capacity growth in the market continues to be manageable but traffic growth in the short term is slightly sluggish," Jet said in a statement.

Jet, which did not pass on a rise in crude prices to passengers fully in Jan-March, expects the full impact of fare increase and surcharge hike to come through only in the current quarter.

Fuel costs made up 39% of Jet's total costs against 32% in the year-ago period.

Earlier in the day, Jet Airways said FY11 consolidated net loss has narrowed to Rs858.4 million from Rs4.20 billion a year ago.

Jet shares, valued at about Rs40 billion, closed down half a percent at Rs457.90 on the National Stock Exchange.