Iberia posted a EUR32.2 million euro million operating loss in the first half from a EUR69 million profit as it came under pressure from fuel prices and weak demand.
Iberia's fuel bill rose 38 percent to EUR732 million, but the Spanish carrier said unit costs excluding fuel fell 6.2 percent.
The company gave no details on its level of fuel hedging. In its most recent update it said it had 48 percent of its 2008 needs hedged at USD$83 a barrel.
Iberia made sales of EUR2.67 billion, unmoved from a year ago, but net profit of EUR20.7 million was barely a quarter of last year's result.
Iberia plans to buy more shares in merger partner British Airways in the coming months, chairman Fernando Conte said.
Conte said: "Iberia intends over the coming months to acquire additional British Airways shares and to close the equivalent part of the derivatives long position," said Conte.
An Iberia-BA tie-up would create an airline worth a combined USD$8.4 billion, flying to over 200 destinations, and would help them compete with Air France-KLM and Germany's Lufthansa, both of which have grown significantly bigger than BA through mergers.
The Spanish carrier last week announced it had a 2.99 percent direct stake in BA and plans to raise the holding to no more than 9.99 percent ahead of the planned merger between the two airlines.
BA holds owns 13.15 percent of Iberia.
Source: http://news.airwise.com/story/view/1217937123.html