higher oil prices raise costs and threaten profitability

Oil prices initially rose on Thursday as the euro rallied and a Nigerian union threatened to shut down output, but they later eased on a report that the European Union could delay a ban on Iranian exports by six months. U.S. February crude oil was down 1.6 percent at $99.26 a barrel after earlier reaching above $102.

European law requiring airlines to pay for aircraft emissions.

d a $3 surcharge each way unveiled by Delta on fares purchased in the United States for flights between the United States and Europe

producing more oil than it’s consuming,

Global oil consumption has been declining since the end of 2011, falling to 88.5 million barrels per day at the end of April, from 90.4 million barrels per day in late December 2011

10 percent increase in production from OPEC during the past 12 months.

, driven by new finds and drilling

a 15-year low—a result of economic weakness and increased energy efficiency.

The price declines

bets that the price will rise

, will fall to $90 a barrel by September, and that West Texas Intermediate should fall to $80.

ince two-thirds of the price of gasoline is determined by the price of oil, that should continue to lower prices at the pump. At the end of May, the average price of a gallon of gasoline in the U.S. was $3.66, 12¢ lower than it was a year ago

2.855 million from 2.963 million

Germany's economy grew by 0.5% in the first quarter of 2012

Earlier Thursday, Germany's statistics office reported a higher than expected rise in retail sales in April, which economists attributed in part to the robust labor market.

However, Germany's Bundesbank warned last week that the first-quarter growth figure likely overstates the country's trend pace. Germany's powerful industrial sector will only make "a relatively small contribution" to growth given the still falling demand from the euro zone, the central bank said. However, a significant growth contribution could come both from construction and consumption, it added.

The statistics office's preliminary release didn't give a breakdown to show why inflation fell.

May's reduction in the euro-zone inflation rate still leaves price growth above the ECB's target level of just below 2%

0.4% in first three months of this year, after shrinking by 0.3% in the final quarter of last year.

Spanish retail sales were down 3.7% in March from the same point a year ago, the 21st month in row sales have fallen.

The rate has risen sharply since April 2007, when it stood at 7.9%.

The new government has announced reforms to the labour market, including cutting back on severance pay and restricting i

nflation-linked salary increases, that it hopes will ease the problem.

The government has also introduced drastic spending cuts designed to reduce its debt levels and meet deficit targets agreed with the European Union. These cuts are contributing to Spain's economic contraction.

S&P predicts the Spanish economy will shrink by 1.5% this year, having previously forecast 0.3% growth.

"We believe that the new government has been front-loading and implementing a comprehensive set of structural reforms, which should support economic growth over the longer term," S&P said. "In particular, authorities have implemented a comprehensive reform of the Spanish labour market, which we believe could significantly reduce many of the existing structural rigidities and improve the flexibility in wage setting."

The yield on 10-year bonds rose to 5.96%, up from 5.81%, suggesting investors were becoming more wary of Spain's ability to repay its debts.