El Al Israel Airlines swung to a second-quarter net loss, hit by a jump in fuel costs, a stronger shekel and increased competition.

Israel's flag carrier posted a quarterly net loss of US$19.7 million, compared with a net profit of US$14.8 million in the 2010 period. Revenue gained 6 percent to US$530.5 million, with both passenger and cargo revenue up 6 percent, El Al said.

Higher global oil prices raised its fuel bill 18 percent to US$183.5 million, the company said on Wednesday.

"We are working very hard to adjust the state of the company's business circumstances through a plan to reduce operating costs which were influenced by a continued sharp rise in fuel costs of about 47 percent versus the same period last year, as well as an appreciation of the shekel against the dollar," chief executive Elyezer Shkedy said.

El Al, which is cutting its route from Tel Aviv to Sao Paulo, will be phasing out aircraft that are not energy efficient, he said

Its load factor -- a measure of seats sold -- edged up to 81.1 percent from 80.1 percent while its market share at Ben-Gurion International Airport slid to 33.5 percent from 37.7 percent.