DUBLIN, Ireland (AP) - Irish airline Aer Lingus reported a $30.4 million loss for the first half of the year yesterday, citing the high cost of fuel and expenses from labour unrest.

Aer Lingus said it lost 20.6 million euros for the January-June period, compared to a profit of 6.8 million euros for the same period of 2007.

Revenues rose 10.2 percent to 632.9 million euros ($934.6 million) on the back of expanding routes and rising charges per passenger. But this was more than offset by a 48.7 percent rise in fuel costs to 172.4 million euros ($254.6 million).

Shares in the formerly government-owned carrier, which was listed on the Dublin and London markets in 2006, rose 4.7 percent to 1.49 euros ($2.19) on the Irish Stock Exchange.

Chief executive Dermot Mannion warned that Aer Lingus would have to keep pruning costs generated by its 4,050 employees to avoid falling deeper into losses in the coming two years. He declined to specify what cuts he had in mind.

The company has been in a protracted battle with labour unions since early 2007 over its efforts to reduce overtime costs and reform rigid employment practices. Mannion withheld promised pay rises until unions accepted a plan to pare about 20 million euros ($30 million) annually from staff costs.

As part of resolving that standoff earlier this year, Aer Lingus reported an exceptional expense yesterday of 17.6 million euros ($26 million) to pay compensation to its employees for lost benefits, overtime and back pay. That figure compounded the first-half losses.

Aer Lingus dramatically expanded its long-haul route network to the US over the past year, but that strategy backfired when the US economy soured and aviation fuel costs soared. Aer Lingus now plans to shut down its Los Angeles service on Nov.1 and has slapped heavy fuel charges on services to New York, Boston, Chicago, Washington and Orlando. The airline said the number of empty seats on its flights rose 5.1 points to 29.8 percent in the first half of 2008, chiefly because of insufficient traffic on US routes.

But Aer Lingus is in no danger of going bankrupt. It reported net cash reserves of 802.6 million euros ($1.19 billion), up 5 percent since the end of December, making it one of Europe's richest airlines.