It's a funny old place the City of London and today British Airways shares soared by 22 per cent at one point as it announced that its profits had all but disappeared (down 90 per cent). BA was boosted by forecasting that its revenue would increase in the next few months even though, thanks to soaring fuel costs, it isn't making any money on all these flights. Oil is coming down in price of course as demand slackens in the global recession. Even so the longer term prospect for fuel prices is less sanguine as an eventual pick-up in global demand will see the speculators, who drove the price of a barrel of oil up to $147 just a few weeks ago, piling back in again. BA says it will cut summer capacity and raise prices to balance its books - but will customers buy that? Its business model is wholly dependent on highly profitable first class and particularly business class passengers who are usually happy to pay super-premium fares. But there's no guarantee that these passengers will come back in traditional numbers when the financial crisis abates. And then there's that nice Michael O'Leary of Ryanair (taking over from Richard Branson as BA boss Willie Walsh's worst nightmare) promising to launch cheap transatlantic flights (his business class flights won't be as cheap obviously but they'll undercut BA and Virgin). Still it's good to see some brave investors around.