Amid a sour economy and higher airfares, the U.S. airlines' trade group yesterday forecast the biggest decline in summer air travel since the summer after the Sept. 11 attacks.

The Air Transport Association, which represents the 13 biggest U.S. passenger carriers, forecast that 211.5 million passengers will fly on U.S. carriers June 1 through Aug. 31, a nearly 1.3 percent drop from last summer.

Passenger traffic on flights within the United States will be down almost 2 percent, while the number of passengers on international flights will be up slightly, the ATA predicted. The forecast is based largely on summer flight schedules and trends in fares and passenger traffic.

If the forecast holds true, this passenger traffic falloff will be greater than that in the summer of 2006, when the arrests of London extremists plotting to bomb airplanes prompted tighter security restrictions that made traveling more difficult and frightened off some travelers. The number of passengers flying U.S. carriers that summer dropped 0.7 percent, according to government data.

In the wake of the September 2001 attacks, passenger traffic the following summer was off 8.5 percent.

ATA officials blame the drop this year on the U.S. economic slowdown as well as the higher ticket prices that airlines are charging to try to recoup record fuel costs. Fuel is an airline's single-biggest expense, and the price of jet fuel has jumped 63 percent since last May.

MORE FARE HIKES AHEAD

ATA chief James May said further fare hikes this summer are "inevitable" as airlines struggle with increases in the cost of fuel.

May said yesterday that jet-fuel prices are approaching $170 a barrel, which he called "absolutely uncharted territory."

To deal with rising fuel costs and other expenses, U.S. carriers have announced fare increases 11 times since late December, but competition has kept those increases from sticking fully on every route. The latest fare increase came Friday, when Delta added a $20 fuel surcharge to the price of its tickets. American, United, Delta, Continental, Northwest and US Airways followed Delta's lead.

But on Sunday, the Atlanta-based carrier rolled back almost half of the increases, largely on flights that service its home city, where competition is fierce with low-cost carriers Southwest Airlines and AirTran Airways.

"It's the first time I've seen Delta be sensitive about overlap markets," said Rick Seaney, chief executive of airfare research site FareCompare.com, adding that he'll be convinced a hike hiatus is coming when demand for business travel slumps.

WEAK DOLLAR'S UPSIDE

Yesterday, discounter AirTran Airways launched a 72-hour sale on flights to all of its destinations for travel through early November.

"As we take fare increases and add fuel surcharges, consumers are not paying them," said AirTran spokesman Tad Hutcheson. "There is some sticker shock out there. People wait for a sale."

Elsewhere, the current economic conditions present a "good news-bad news" scenario for international carriers that serve the U.S., said Steve Lott, a spokesman for the International Air Transport Association.

"International air traffic originating in the U.S. this summer will likely be slower ... (but) the weak dollar and economic growth in other parts of the world make the U.S. an attractive destination and a good value for inbound leisure passengers," Lott said.

Tom Parsons, CEO of travel Web site BestFares.com, says, "Leisure and business travelers are seeing airfares increase almost weekly."

The Associated Press contributed to this report.