Singapore Airlines, the world’s second largest airline by market value, reported a worse-than-expected 53% fall in quarterly net profit, hit by high jet fuel prices and warned that passenger yields would be under pressure, reported Reuters.

The carrier, around 55% owned by Temasek Holdings, made $135.2 million profit for October-December, down from $288.3 million a year ago. The earnings was lower than average forecast of $162.5 million from four analysts polled by Reuters.

The global airlines industry has been struggling to pass on the higher cost of fuels to customers as demand for business and leisure travel dwindled due to the global economic slowdown.

The International Air Transport Association (IATA) cut its forecast for airline industry profits by a quarter to US$3.5 billion for 2012 and warned the industry could plunge to an US$8.3 billion loss if Europe’s debt problems trigger another banking crisis.