In the year to July 31, traffic was up 8.8 pct.
Cargo traffic increased by only 2.2 pct in July from the same month of 2004 and 3.5 pct in the year to July.
IATA, which groups 265 companies repesenting 94 pct of international traffic, said passenger planes were 79.6 pct full from January to July, up from 74.8 pct in the same period last year.
"Carriers are responding to the summer travel season in the northern hemisphere with careful capacity management," said Giovanni Bisignani, IATA director general.
"Globally four out of every five seats were filled in July with every region reporting load factors in excess of 70 pct."
He said strong passenger numbers and fuel surcharges were helping airlines offset the soaring price of fuel.
"The extraordinary high price of fuel means that cost reduction has gone beyond urgent.
"With oil in the 70-dollar-per-barrel range every drop of unneeded fuel burned and every cent of unnecessary expense is simply not tolerable," said Bisignani.
Escalating fuel prices in recent weeks have brought the year-to-date average price per barrel to 53 usd.
"Every dollar added to the price of oil adds one billion dollars to airline industry costs," Bisignani said.
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