UPDATE 2-Jet Airways to put global expansion on hold -exec

(Adds details of oil price impact, background)

By Fang Yan

SHANGHAI, June 16 (Reuters) - Jet Airways (JET.BO), India's top private airline, plans to put its international expansion on hold until the end of next year because of soaring oil prices, its chief commercial officer said on Monday.

"After this flight, we will probably only launch Dubai when we get the rights," Sudheer Raghavan told Reuters at a ceremony marking the launch of a new daily flight between Mumbai and San Francisco via Shanghai.

"After that we are going to consolidate our international operations until the end of 2009, when we get new aircraft."

Jet Airways, controlled by billionaire chairman Naresh Goyal, has been expanding its global route network aggressively. It now flies to 62 destinations including 19 cities outside India, up from 11 at the end of last year.

But with crude oil prices topping $130 per barrel, long haul flights now take as much as two-and-a-half years to become profitable, compared with 12 to 18 months when oil prices were at $50 to $70, Raghavan said.

The price of Indian jet fuel, which accounts for nearly 45 percent of an Indian carrier's operating costs, has risen almost 90 percent since last June.

Jet Airways lost 911 million rupees ($21.2 million) in the third quarter to December 31, 2007, compared with a profit of 400 million rupees a year earlier.

Raghavan declined to comment on the airline's fourth-quarter earnings, but said Jet was maintaining its earlier target of returning to the black next fiscal year.

RIGHTS ISSUE

He also said the airline intended eventually to conduct an equity rights issue to raise funds, but that "this is not the right time" because of high oil prices and weak global stock markets.

In April, Goyal said the airline was assessing the market for the launch of a rights issue. The company had previously said a rights issue might raise up to $400 million.

Raghavan said Jet Airways intended to invest around $10 million to $15 million to set up a cargo unit, which would likely be launched in mid-2009 or in the second half of that year.

But instead of ordering new aircraft for the cargo subsidiary, Jet may convert some of its passenger planes into freighters, he added. Jet Airways and its JetLite unit, a low-cost carrier, operate a fleet of 108 aircraft.

Jet is in talks with Air China (601111.SS), China Eastern Airlines (600115.SS) and Shanghai Airlines 600591.SS on possible code-sharing deals, Raghavan said.

The airline aims eventually to expand its route network to other Chinese cities, he added. "I see more exciting days ahead. Beijing is certainly on the cards." (Editing by Andrew Torchia)