Shanghai Airlines has announced a 91% decrease in profits. The loss occurred despite a 21% growth in sales to 3.53 billion yuan.

Airline profits plummeted in the first half of the year while oil prices continued to inch upwards. The loss was recorded despite a big increase in sales.

Oil prices are not expected to go down in time for carriers such as Shanghai Airlines to turn the situation around this year. China's fifth largest carrier saw profits for the first half of 2005 plunge 91 per cent. Investors took the hit, with net income down 13.35 million yuan (US$1.65 million) or 0.012 yuan per share, down from 145.3 million yuan or 0.134 yuan a share in 2004.

According to China Daily, Chinese airlines saw losses of 340 million yuan in the first five months of 2005.